@Bob Estler I understood that you already own the note, but I still wasn't sure what the problem was with trying to figure it out between the property owner ("seller") and the tenant.

I still believe that if done properly and ethically, this can benefit both the homeowner and the investor, but the agreement has to be fully understood by both parties. 

Make sure you have everyones job/position/investments/percentage in company clearly stated and understood.  

The tenant acknowledged the text and said that they understood that they had to put the utilities in their name, before that final date.

@Pedro Martins Allow me to clarify from how I understood the original post.  

Understood, but my understanding is that is harder to get financing on $60,000 houses, meaning you'd have to pay cash.

I have never understood why tenants would pay more for renting by the room than it would cost to rent the whole unit but apparently it does happen. 

Understood.

For example, a few years ago I read The Motley Fool’s “8 Steps To Having More Money Than Your Parents Ever Dreamed” and it was great because it was written for high schoolers and could be understood by anyone.

I understood that you cannot get out the PMI with an FHA unless you refi with a conventional.That makes sense regarding what lenders lend and why.How aggressively did you drop it?