Attend in person, bid, if you win you have to pay right then via a cashiers check.

I'd recommend looking at costs. your build cost is going to be well over other homes because of the fixed costs like slab, Hvac, roof, etc. check the market drivers and weight the benefits of short term versus long term. long term is no furniture and help pays mortgage but at this size it doesn't really cover everything. we didn't find a lot of economies of scale in single family detached. can you build more than one unit?

You won’t get the metrics like the pay down or the returns on the second note this way but you can get the accurate cash flow.

How much is this individual paying to park a trailer there?

Ultimately, it comes down to underwriting and the ability for the property, and you, to afford to pay the monthly expense of the loan. 

I recommend you start with duplexes as you should always have a paying tenant.

This also begins YOUR title seasoning, so that when you're ready to take out a traditional mortgage, you can refinance and pay off the seller without a title seasoning issue. you can buy title insurance from the title company at closing. this is a good idea. 

As of today they stopped paying the interest.

Right now you have $1,000 in cash flow that can be used to fund other projects (seed money), pay you in profit to supplement your lifestyle, or fill in any gaps for underperforming properties.  

If you pay off a property or owe more than it’s worth, you can still owe or not owe capital gains tax.