Sid not to be a jerk but it doesn't seem like you've done much research.Your criteria is way too vague and broad for anyone to start searching for properties for you.You didn't tell us: -How much money you have?

The vast majority of the properties go under contract before the rehab is done, however, the investor doesn't close until the rehab is done, an inspection completed and a tenant in place.

@James ManessMy limited experience with commercial lending is that a loan of that size doesn't qualify for non-recourse terms.

It doesn't really exist.  

I want to make investments I can repeat so this method doesn't seem to solve that issue, just cut it in half.

If its not then your tenants won't be going in the basement, it doesn't have to be done.

You can't do a subject to on a short sale ( that doesn't make sense. ) You can do a subject to on an underwater property, this may make sense in limited situations. 

I figure I can manage it in the beginning and then hopefully find a competent property manager that doesn't charge too much if i need to. 

The contract doesn't really matter as long as both parties are agreeable and remain agreeable until settlement.

If your income is high enough, the tax rate may be 20%.Also, don't forget your state will tax the gain too, if there is an income tax in your state (TX doesn't).