.; outstanding mortgage = $164K @4.5% Fixed 30 year).Property 3: Florida SFR 4/2 (paid $169K, worth $200K; rents for $1300/mo.; own F&C).Properties 1 & 2 were acquired with lease options in place near the height of the RE bubble in '06 and '07.

I am assuming that they would take % cuts of the outstanding $.

What things should I be looking at during the closing process to make sure of title to the property, outstanding liens, deed problems, etc, etc.I'm looking for any suggestions on anything I should be doing to protect myself during this transaction.

This company allows you to blast your listings nationwide or to a certain area you want your home marketed to. 

@Daniel LevineI work with investors to get them into emerging markets nationwide, most of our investors do not choose to make a site visit prior to purchasing.

Even better, work with an insurance advisor who is also actually an active investor also and who exclusively represents a company who's products and services were all created by seasoned investors FOR investors and are the nationwide leader in residential risk management solutions FOR investors.

I know that the property previously sold for $200K+ in 07 08 if I remember correctly so I would imagine that the outstanding balance would be significantly more than $85K. 

NAHB.org puts out a new building cost chart that is the average cost nationwide from survey respondents.  

Perhaps its not nationwide but here in LA  inflation is beating the interest rate in a big way.   

Also, "the lender must document the borrower's equity in the existing principal residence with an appraisal, automated valuation model, or Broker Price Opinion, minus outstanding liens."