Suffice to say, the deal is off and the bank is going to begin foreclosure process and most likely open bidding to the public I reached out to the bank, and they mentioned I could potentially “buy the note” from them so at least I could secure the property for my church.

Can anyone recommend a bank with decent terms for a non OO HELOC? 

The second, is that I want to build a non-profit business dedicated to the housing and rehabilitation of homeless veterans. 

Of course if you ask worse case scenario there is always a worse case.. but then logic comes into play.but some folks are nutso about no one knowing what they own or making it hard via public records..

There were 2 separate individual (non-connected) houses on the lot.

Non-required, cheap insurance is worth having. 

A few things to consider:R-2 will help, but depending on your current lot, some characteristics may still be "non-conforming" -- i.e. parking, density, setbacks, etc...

Also, if the IRA is the buyer the loan must be non-recourse, you can't use conventional financing because personal guarantee is not allowed. 

Ben Davis the problem with 2-50 units is economy of scale but most importantly until you get over a million dollar loan size you can’t get Agency debt which is non recourse.

This is a non-cash expense, which is the best kind to have, since it will significantly boost the Smith’s return.