If you had found an amazing deal in NC and you needed that money for the down payment, I could see that, but to me, there's no harm in leaving your 401K in place until you have a very specific use for it (like that great deal).  

A home would be non-lendable due to its habitability.

As an energy auditor, I get these calls all the time,Popular things are:-extra fridger/freezers in the garage (typically a free or old one they dont realize uses a ton of electric),-Hotwater tanks & Heating (is NG an option) If not look at airleakage and insulation-Failed wel lpumps or sump pumps that never stop running,-Non-Energy star Dehumidifiers,-electric space heaters that get left on or forgot about-A ton of Incidence light bulbsAnd the biggest one, Is typically not the KWH at all, but people switching to other non regulated providers such as ambit who have a habit of slowly creeping up to double/triple the market rate.

Further, be careful putting another party in harms way by trying to sell an interest in a property that an imminent foreclosure.  

2) Are you disciplined now in your spending habits?

Then as soon as prices go down, we go back to our old habits.

If you live in one unit and rent the other, the banks will be very agreeable.When you narrowed down your neighborhood, find an agent who is also an investor and learn the local habits of buyers and sellers.   

However, if this lady is demanding that you not only offer, but close on this property without seeing it, I would drop this like a bad habit.

I think my investing habits would also be more aggressive if there were more properties available that met my criteria.

After Sandy the town did mitigate the taxes on a flood damaged home and also utility companies removed meters although we had electric and water (no gas) but those properties were not habitable.