If you're betting on appreciation, you might do ok.As far as why someone else didn't buy it, you never know.

I suggest your "friend" sell or refinance his properties and you not ask about the chances of getting caught, they aren't that good. :)

It will look refined and modern.

You have a story to tell and unless there is much more to this story, I can't imagine this preventing you from getting a loan as long as you are ready and willing to put 20%-25% down on the duplex.Your rate will be higher sure, but you can refinance in a few years as your credit continues to improve.Mistakes happen.

It is not going to help your DTI unless the lender agress to let the new entity assume the loan or you refinance with the new entity.

The IRS doesn't get the note terms.If he refuses to close you have him on a valid contract, he won't want to go to court for performance, nothing personal, it's just business.If he closes he can come by personally and pick up his payments, I'd bet he gets tired of that.

It sounds like the best way to remove it would be trying to make additional payments on my mortgage to get to the 80% mark and then refinance if rates justify a lower monthly payment.

What would be my best bet as to start up money or money up front ?

Remember this is only for Fannie/Freddie loans, and they allow up to 10 the first 4 are just easier and can be cash out refinances.

If I'm off on my rehab costs or my ARV, all bets are off.