This property still cash-flows but definitely under performs (due to flood insurance in my opinion) compared to the others.

@Hen Ley Hello.There are many portfolio/commercial lenders out there that will provide loans based on the performance of the property.

A good contract will impose performance standards that will protect you in that regard.

Otherwise you'll be in the same situation that the people you are buying from are in.It takes a special skillset to take a non performing rental and make it profitable.

@Keesha DuminieI would target something where by benefit of skills, relationships, or location, you are likely to out-perform the average expectation.For instance, someone that lives in a small university town is much more likely to out-perform and fix and flips there when compared to an out-of-state flipper.

For instance if you need more time for due diligence or Settlement deadline you can do an extension in an addendum.  

Depending on where your property is located the buyer can ask for an extension of repair after the close of escrow and a deposit held for it. 

I guess his confidence is his lawyer told him if he has a buyer before this redemption period ends, he can likely get an extension.....

I could turn around and discount and sell the paper for the same amount as if I wrote a 7 year 15% note.. and I have used this arrow in my quiver ever since usually to sell my duds  LOL  but you do have to deal with IRS as stated.. there is no question zero interest financing is  an extension of credit. 

They get paid that percent regardless of how your portfolio performs. 2.