What're some good buy and hold neighborhoods, preferably B-C rated and what're some neighborhoods to avoid?

Free is most definitely always preferred.

A lender will look at DSCR for a commercial loan, but as an individual investor I would never use your criteria.

Hey @Pamela Mitchell,I have not used any of the programs, however I prefer to learn through experience, and through BP as @Josh Nicolson and Account Closedmentioned.

Second, narrow down properties that interest you before the sale, drive them preferably and go to the county assesment office to look up any mortgages or liens.

Looking for class B - C MF properties with between 8 and 60 units - multiple properties are okay but would prefer that they be in the same market to facilitate management. 

I understand the preference, but he's only got a few months left and clearly doesn't care about the smoking prohibility.

We do have a lawyer lined up who should be able to take care of that aspect, so that's good to know.In terms of the structure you proposed, I just have a couple follow up questions to make sure I understand properly:1) If the investor pays us $50,000, we would offer to pay him a preferred return of $3,000 per year from the monthly income we receive?

Obviously if your other choice is 2% in a bond it may be a preferable investment if the building has been well maintained - at least IMO. 

Currently the outstanding loan amount is $34,000 under the tax assessment so I can use the equity in future property investing.Yesterday an individual from a respected property group in the area stated the house would rent for $1,300 a month (which matches my research).