Some DSCR lender may jump on here and say they do them but I don't like their terms typically.

The structure will depend on the down payment, quality of borrower, terms of note, your cash out of the note sale needs, and other factors. 

Phoenix contains a rare combination of elements that have created an outstanding market for distressed property investments, including the following:Cost Savings: Distressed properties are sold below their market value and enable investors to take hold of properties at a trifle compared to traditionally listed properties.Strong Market Fundamentals: Being among the fastest-growing cities in the country, Phoenix ensures a high demand in housing and rentals, hence good potential for resale or income from rentals.Value Creation Opportunities: Most distressed properties need renovations; thus, such situations present opportunities for investors to increase equity by adding value.Population and Economic Growth: Phoenix remains among those cities in the country which are attracting more and more residents and business; therefore, this presents good, long-term appreciation possibilities of property appreciation and income creation.Challenges to ConsiderWhile the rewards can be great, distressed property investment is not without its challenges.

"We do not expect much further upside for housing demand near-term.""

If it's worth that much, taking a HELOC on it should not be an issue at all long-term or short-term as long as the bank will do it.

Thanks, I'm looking to get into short term or long term rentals for starters.

If he has a $5MM loan in place, what was that used for / is it coming due/ was it short term/ etc.?

While that kind of income is not a deterring factor, when I looked over the terms of service many big red flags came up.

Remember this is a marathon......That said are you planning to flip, hold(short or long term?)

What about rate and term refinancing?