I am at the point now where I am feeling comfortable moving forward with a deal if I see potential in the property.

So even if MFB was doing good and had no leverage or affiliation with the creditor, since MFA collapsed MFB investors are stuck holding the bag and are potentially going to get wiped out.

@James Heiberg The mindset I am seeing in Denver right now is looking for a property that may not cashflow AS you live in it, but has the potential to cashflow once you move out and it's fully an investment property.

As part of due diligence , what should I be asking to the developer, what are the potential pitfalls and how do I protect my investment ?

Leaving servicing up to the lender could potentially put your installment payments at risk and in many states servicers need to be licensed anyways so double-check that part as well. 

But in the meantime, the hazard pay is pretty good.

On the flip side, two-story homes provide more living space, greater design flexibility, and the potential for higher investment returns.

Alternatively, if your headache is entirely just from having to think about the property, maybe it would be better to pocket the potential $350k profit from the sale and move on.

Make sure you've studied the market well in order to comprehend the demand for rentals and potential cash flow.It's a wise decision that you want to establish a connection with regional investors in the Houston area.

Second: You will need C) Executory agreement (add clause that if you default on the payment, seller can take back ownership D) In addition, a purchase an sales agreement reflecting the subject to the existing mortgage note, under the seller's nameGet title insurance with the seller as a secondary in addition to the insurance already on the property.The purchase agreement reflecting both the equity payments and mortgage subject shall be executed and held deed to property, via this hybrid transaction be transferred into the buyer name..The deed, instead of being recorded at the registry, triggering a potential risk of a due on sale clause, shall be held in a mutual accessed safety deposit box along with the executory contract.