The reason for the seller's willingness to discount that much in today's climate, from what info I have so far, is due to the extremely low rate on the modified loan (less than 2%, recast for a new 30 year term).So due to the rate, even at 50% of UPB, the return on my investment would be around 4% after considering servicing fees, etc., which is not nearly enough to interest me in this deal, considering the risks of borrower re-default, etc. 

The reason is I know which lenders:- do a good job- stay on top of the necessary tasks- know how to be creative within the rules (some people don't fit into the standard mold of a buyer, and some lenders don't know how to get them approved, and some lenders know how to get them approved)- and which lenders can actually close deals.Another reason is, when someone wants to house hack, not all lenders are experienced in it.

There are many reasons that a condo can be non-warrantable.  

Or do you want to gut because __(reasons)___?

However, a person shall be deemed to have notice of a fact if he has actual knowledge of it, he has received a verbal notice of it, or from all the facts and circumstances known to him at the time in question, he has reason to know it exists.

Another reason we insist on vacant possession.

Agreed, the owner likely just Thinks he needs to do this....no mtg, legal or tax savings reason for doing it.

One of my main reasons for investing in the North side of town is because I want to make a difference and improve the communities in which I grew up.

Is there any reason why mortgage company doesnt want to refinance it ?

Where his connections in the market have other agents bring him deals where for some reason their clients don't want to list on the MLS.