I also thought about just taking out an FHA loan (since my wife and I both have 750 credit scores) and buying a house and renting out my mobile home to cover the mortgage.

Philly also has 2% transfer tax, vs 1% across the other parts of PAOther factors like the current investor loans charging at 8%.

Many Americans have zero financial  literacy and are irresponsible with debt.  

I am struggling to find any lenders that will do a line not a term loan.  

Option 1: I was thinking she gets her $650k, she holds the note on a 40 or 50 yr amort loan.

Sold to a Veteran who used a VA Loan Lessons learned?

@Kevin RockRecommend you first figure out the property Class you want to invest in, THEN figure out the corresponding location to invest in.If you apply Class A assumptions to a Class B or C purchase, your expectations won’t be met and it may be a financial disaster.So, when investing in areas they don’t really know, investors should research the different property Class submarkets.

@Cliff DurrettIn some instances the first will take a discount to give the second some money, but in this instance they are so underwater I don’t think the second will approve this as they are basically getting wiped, and they have much higher BPO’sAlso be aware the lender may satisfy the loan but not release the debt, meaning they will allow for short sale but then get a judgment to have the balance of Debt validated and still owed

I have been told that many financial institutions don't approve seller financing a second mortgage for the down payment. 

They can push a DSCR loan into negative cash flow territory which makes the rates even worse.