But a commuter trades some housing expense for the home and instead have $400 up in commute costs (plus wear & tear on vehicle and lost time, say 2 hours each way - pre COVID - better than 2 hours until normal commute resumes). 

Assuming you paid $80k to buy, $15k to renovate, $5k for everything else, $100k total, and received $35k/revenue a year.

Yes it is a viable option but it is very different than 2008 and also very different pre covid.

I paid them as instructed and they agree to return money and I trusted them based on their website, it seems professional.Once they received 3% ($1230 USD) payment by wise, they demanded 20% of the money as collateral mortgage since I did not have the property title.

That's what you paid for, after all.   

Open escrow with homeowner, end-buyer, and self; self transfers contract to purchase to end-buyer in Title/Escrow, and provides T/E with end-buyer's contract with self: agreement to purchase, and fee instructions for self ($10k + difference if any) to be paid out of closing escrow5.

The house is paid off free and clear, but we have no intention of selling it; we want to keep it in the family and turn the lot into a vacation home, Airbnb, or even a rental.

Jason, how do find the pre-foreclosure properties? 

That way you get paid and also facilitate the move and make sure nothing gets damaged.

I know this isn’t a popular answer, but rocket lawyer has some decent pre made templates.