This year I may see if if I can get a construction loan to build 20-30 apartments, then refinance with an asset based lender. what markets?

I wouldn’t want to hold the loan for too long, so ideally it would be a 5 year term, presumably ballon payment at the end.

My plan is to buy the house subject to their existing mortgage, renovate the property, refinance it and pay off their remaining loan balance using the money from the cash out refinance.

Both of these allow you to low down payment loans to buy a primary residence with fixed interest rates.

This seems to be a VERY good deal for a BRRRR and I think you should be able to find a local lender (bank or credit union) that would finance this with a DSCR loan.

There is a reason banks don't make loans on stocks.

Did you close this with a hard money loan?

In today’s market most homes will be worth more than their outstanding loan balance unless they are VERY recent purchases with little to no money down.

A turn-key provider would be a company that can handle everything from sending you deals that fit what you're looking for, assist in getting you pre-approved for a loan, rehab (if needed), management, and maintenance. 

The substitute of collateral was more of a scenario where you sold for $155K, and instead of paying off the $88K loan in your scenario, those funds stayed at the title company and were used on a cash purchase happening nearby in date.