Definitely consider permits regardless though.

The operating agreement likely has an entire section dedicated to permitted transfers. 

It was just converted into a legal 3 unit to code with permits.

I am putting them on their own land in rural areas where it is permitted to do so.

I am interested to hear some of the experienced Chicago investors thought/opinions on how you think Mayor Lightfoot's plan to "limit aldermanic prerogatives" as it relates to zoning and permits will change the permitting process in Chicago especially as it relates to Expeditors.

If the repairs were DIY without pulling permits or getting inspections and/or not done in a proper manner, the investor might get nothing at all, because the repairs did not increase value.

Unless you are going to get a sizable cut on this and willing to take on all the potential liabilities associated with running an STR and having strangers in and out of your property, including being responsible for any permitting that might be required, not sure why you would do it.  

If the foreclosure were to result in a deficiency (the lender is not made whole), then a suit (or additional claim) against the guarantor might follow... if permitted and worth the effort.If your friend is never a named defendant it should not affect credit.

I've made inquiries with the city building permit department about the requirements and restrictions, e-mailed several egress window companies as a start but don't know where else to look.  

Thanks @Russell Brazil.But to clarify my question, I am asking if investors are permitted to negotiate short sales on a seller's behalf with the intent of purchasing the property once a short sale is approved?