Hi John, I'm based in the Seattle area, but do most of my investing in midwest markets (Memphis and Detroit). 

.- When starting out, keep in mind that everyone speaks based on their experiences and mindsets.

Lot of options and opportunity all around the city.

Everyone should know how to calculate the worse case scenario and make an offer based on that.If there are good tenants with solid leases in place, in a great market and the seller won't budge, that's probably not a place for a super deal.  

@Rolando De la Cruz you don’t have to be stuck using an FHA loan to get a low down payment loan option.

I'd keep contacting the Code Enforcement Office (based on the squeaky wheel gets the grease theory).

Hi William - just wanted to share an article I wrote about DSCR Multifamily Loan Options and Pros and Cons for this exact need (5-10 unit multifamily). 

Perhaps adding an additional half bath is optional and could be eliminated if issues come up or perhaps for someone who is hands on perhaps they could take on more work themselves if they needed to and extend the rehab time period.

We went into this investment and ran our numbers based on a 4 bed/2 bath.

If you have to bring in a partner with more experience and or funds, that may also be an option to help maneuver through this deal.