The hardest part is walking to the mail box and pushing that little red flag up. 

Perhaps a nice 1950's built bungalow.Always hire a 3rd party property inspector to give you an unbiased feel for the home.

I'm guessing that interest rates for this would be 3.75 - 4% owing to the cash out part. I

That can be a problem itself since your not a party to the original mortgage or the foreclosure. 

That part is about them, not the house. 

I have caught many mistakes over the years in recorded documents basically in real time (there's sometimes a lag of a day or two before recorded documents appear online), and forced the mistaken party to correct the mistake.

Generally, banks will want anyone with 20% equity interest to be a guarantor on the loan.The "correct" deal structure will take into account all of the above and what people have mentioned already on this thread but at the end of it will come down to what you and the investor(s) deem as being fair/acceptable.How does that saying go - You know you know negotiated a good deal when all parties are equally unhappy ;-)

However due to my current profession I don't have the ability to manage and all of it will be 3rd party managed. 

So, even if it appraises at $145K, they will lend based on the lower of cost or appraised value.So as you can see, this is totally different than selling a flip to a non affiliated party.  

These IRAs, of course, must be held by an IRS-approved third-party administrator.