They have accomplished this through careful vetting of the rehab/flipper's plan, 1st mortgage security position, short term loans of 6 mo or less, and careful validation of ARV.I think this is an excellent example of a finding a solution to short term cash investment at an attractive rate and benefiting the renewal of our neighborhoods via seasoned flippers.

The entire property (larger home and cottage) is on zillow for almost 1 million.

There are multiple note buying/selling sites you can google up, but assuming your note has a reasonable interest rate, the note will sell at a significant discount to the current balance, so this may not be an attractive option. 

Your question is a million dollar one.

(an attractive location for any small business) Currently 2 salons occupy 2 of 3 commercial spaces.

But they are getting fixed rate debt or floaters (with caps or swaps) at very attractive terms that are typically not available to most non institutional borrowers.

However, keep in mind, in a competitive market, all the contingencies can make your offer less attractive than those without.

I've tried various things: shorter inspection time period (typically it's 10 days here, and if you do a 3 or 5 day inspection time you can be attractive b/c the seller can get it back on market quicker if you find something you don't like during inspection period); non-refundable earnest money (maybe $1000 of money that you will not get back for any reason on your side - not if the seller breaches-- should the offer not go to completion - this shows you are an extremely interested buyer, but you could lose the money, so use cautiously and with the advice of your agent who knows how to correctly write that into the contract); put a limit on the repair request no required by lender - cap it at $0/as-is, or $500; a higher earnest money - like $5000, shows you are serious.

There are millions of deals out there.

The down payment you describes is 1 Million and you are providing 30% of it.