Other investors can offer insights into renovation costs in your area and might even recommend trusted contractors.

- Aim to have enough for a down payment depending on your market it could be a whole lot or a lot less.

If the buyer defaults, the seller finds himself personally liable for payments, or if the default goes far enough, liable payment of the loan balance, on a property he does not own.  

I have an opportunity to take over mortgage payments from a seller for their remaining mortgage where I would be on title, but not the loan.

If you only have one source the source giving you the deal then that is uneven and at that point you need to realize you are lopsided in that partnership (unless you have built years of trust).

A lease was signed on 1/4/24 but no payments have been made by HUD yet this year.

A self-directed 401K is different since it’s a trust.

I was thinking out of the down payment (Increase down payment by my fee amount and reduce the purchase price by same amount). 

:)  You will want to do both A and B. you will want to save enough for a down payment and enough in cash reserves for a rainy day fund.

And request payment within 10 days to avoid legal ramifications.