Get a deal it's ez to give away money, I went to a local RE meet up in my town when I had my first deal under contract and had people fighting to buy it....now all of them are on my list.

My first thought is that lenders would fight against the option, for a number of reasons, but loss would certainly be the main motivator. thanks for your input/insight.

A good tip is to look for properties being sold by owners who own them free and clear and would be willing to do a owner financing arrangement, it could really help you get started without having to fight with banks to get financing. 

There is a lot available so I was just curious would it be worthwhile to build on it instead of fighting others for houses in the area. 

What I mean by "bad employee" is that I fight within myself to be ordinary.

Either way, you could still sell the house by bonding around the lien, filing a complaint with CSLB to go after his bond, and then fighting the contractor in court. 

Every deal has a front door and a back door, know where they are.Your real or perceived equity is always at risk with a sub-to, if you don't have the money to pay off the obligation you need to understand that you may need to walk away from some of that equity to live to fight another day. 

He and other landlords have a strong cases to fight it, but it's never fun to tangle with the city.

Putting a family in a cramped, akward space is going to mean short term tenants, and I'd rather get a little less rent consistently for years, than fight vacancy for a couple bucks more a month. 

Your only hope in a fight is to dispute the "current market value" of the 8 sqft but more than likely not worth the costs involved.