The rent does not cover the mortgage, not even close, so subject to isn’t in question.Without much equity I’m assuming I should not pursue and tread lightly w/o further damaging the position the landlord is in?

Well there's the law, and there's putting yourself in his position.

Your friend/relative will be 1st position lien holder. 

I am trying to acquire a property.  I have 10% cash to put down and can get a bank to cover 60% of the Value,  how does someone obtain the additional 30% from open market funds?

I would imagine the owner financed loan would take second position to the bank loan, correct? 

Hello All,I am a first time investor recently purchased two multifamily properties (4 units) - 3 are currently rented and 1 is under rehab. the properties are in not so good area but has a potential to generate positive cash flow if all are rented with min maintenance.

When you look at depreciation as an “expense” you generally have a “money losing” property despite positive cash-flow.

So what should I say or how exactly should I approach the homeowners without being in the position of being sued?

I have a job in chemical industry (manager) and a good salary (90k a year).I started with buy & hold real estate in 2016.

rehabbing from the start delays rental income and could put you in a tough position financially and lenders don't like that.