Finally they sealed the cracks and my contractor later applied floor leveler to ready for flooring.With the foundation issue resolved, my contractor removed all the fire damaged wood, cleaned up all the soot and began a general rehab of all remaining issues.

The borrower's only remaining option is filing BK or work out something with the lender.

@Andrew Aladjadjian I think you have a good point the money down will help with the monthly flow I just would prefer not to have so much cash tied up in the event I can move on another investment sooner rather than later. 

Even with the large down payment taxes will likely eat the remaining income.  

Renovations must be completed within that 180-day timeframe, and the property must remain with the 1031 intermediary until completion. 

By that I mean do minimum down with your house hack and then turn around and buy an investment property with the remaining $$$ (of course making sure you have ample funds for repairs, reserves, CAPEX, etc)?

Most of the money saved up from equity from a sale of my previous house and the rest I obtained from a family private loan to bridge the remaining $13,000 gap.

There is one big problem, though: The bank is going to require the property as collateral, but if the remaining partner owns free and clear, why would he agree to this?

Then we had to tie into 24/7 monitoring + an annual inspection which we are now upgrading for a much better price than ADT/Protection One. 

Paid 80k. 8 years remaining on 15 yr conventional @ 2.99% and $49,500 left on the mortgage.