Service contracts are key, and I'd recommend getting a detailed, itemized scope of work included in it, along with benchmarks required prior to subsequent draw payments. 

Thank you all for your feedback, I guess I need to take this one back to the drawing board :/It just feels like Dallas/Collin is such a hot seller's market right now that there is no negotiating deals other than offering full or above list price currently, so I was trying to be creative in thinking of other alternatives that would give me more negotiating power.I understand that sellers in pre-foreclosure are probably not going to give me or the lender any money, but do you think it would be worth it to them to redo the deed in a land or living trust with joint ownership(with me) if I were to 1) bring the loan current and 2) take over the payments, so that their credit score wouldn't be wrecked?

Assemble drawings for a building permit showing you are fixing all the code issues and you should be able to get temp utilities.

They ask me how much I rent the property for and what months I am owed rent.  4)The admin guy walks up to a black board and draws a matrix with months, rent, amount paid, difference.

Just be sure to do your research, and understand that depending on the loan and the size of the renovations the money may be released in draws as the work is being completed.

If you're in and no nice and draw and want to get premium pricing paint it.

This includes things like origination points, fixed fees, draw fees (from repair escrow), required 3rd party fees that other hard money lenders would not require (e.g. certified appraisal, legal fees).- When are the points & fees paid?

The only thing I would add is that a title company/closing attorney that draws up the note can put multiple people/entities as the beneficiary.

It is my plan to draw up a portfolio of these properties over the next number of weeks and to start making enquiries re their availability.I have come across a route to the details of owners of properties showing potential which are not listed with a Real Estate Agent which I believe may be an angle that will result in acquiring some great value deals.Anyway, that's my intro, I look forward to interacting with the community here and learning lots to aid me with my upcoming steps into the market.Martin.

Second question is once he's out and I'm seeking new tenants, is there any way to sift out those "needy" type of tenants or is it luck of the draw?