Problem is that if I sell, I will lose $6k immediately for a prorated soft second mortgage from the Cherokees.

Information is valuable, you could also consult with owners (for a fee), show them how they can stop a tax sale foreclosure, how they can delay it, how much time they have.You could offer to buy their property giving them an option to buy back when they are financially able while remaining as a tenant.Hard or soft money loan will give you a great return on your cash.

Hard/Soft money lenders are still expensive.

Would you mind sharing your acquisition, construction, soft costs and holding cost projections?

It is 1200 soft though, so fairly large.I would say you could do between $620 and $700 assuming it's reasonably sized. 

And I apologize if I am hitting a soft spot here, please don't take offence.

The helps me figure out what you the flipper can get for it or ARV.2) I need to understand what you are going to do to the house and how long it is going to take so I understand your (the flipper) holding costs (the soft stuff)3) I need to build in plenty of margin so when I get it wrong, I don't loose my shirt.  

When really those are soft woods at best. 

Ran into money issues I was soft and gave in.

A good reason to check out all soft spots on walls.Early on, we passed up a deal on a house because one of the kitchen walls had a "squishy spot" where a wall repair had been made and covered up with paint.