Conventional systems will typically cost less than $20,000, but if an Advantec or other specially designed system is needed costs can reach or exceed $30,000".See Cesspools and the Rhode Island Cesspool Act Frequently Asked Questions and The RI Cesspool Act Goes into Effect 1/1/16: What Buyers & Sellers Need to Know (from which the quote above was taken).You will want to check with your mortgage broker, however, with whether the bank will have a problem with a repair credit that large.

They are older and will need repairs in the future.My plan would be as follows:Purchase for $200,000 with 5% down so I would be into it for $10,000.I am asking that the owner hold financing for 5-7 years at 6.5% while I save the monies, improve the properties.  

I fully agree with you on the land; we're not wanting to go into the suburbs but rather exchange 15 acres of ag land for 2-5 acres of wooded land. (35 acres with the rental home included) All this acreage adds up to a lot of work in fence repairs, keeping ag status current with cattle, cleaning up trees that have been dying in this long drought, picking up trash that blows from the road, weed control, etc.

Anyway I’m 2 weeks into this deal and expect all the demo, repairs and paint to be wrapped up in the next couple of weeks and I’ll begin furnishing all the units with new stuff.

When the photos of her 'surprise' hit my phone, I almost fainted.

Although I have the money for purchasing and the repairs up front, what kind of money should I keep in reserve for after the deal?  

I will find the property, get a conventional bank loan, find a tenant, do the repairs etc. and manage the property.

It could be A) you are asking them to pay closing costs which could be about $10,000 or moreB) They know of repairs that are needed to get FHA approval that they would have to complete which is why they requested conventional onlyIt could also be both. 

You can buy a home that could need rehab or cosmetic repairs and fix it up yourself.

Gary Clisele Also if your buying a note for $5k the quality of the asset will be very poor and is most likely a property in a D area that needs extensive repairs -If you end up taking the property back it will probably be a loser since the rehab will be higher than the property is worth