@David Krulac  my most successful condo convert was on a storage facility I owned.it was very straight forward and since there we no inhabitants or utls other than power it was a slam dunk.. now that did not factor in those that sneak in and live in storage units LOL.. had a few of those over the years... 

That first step on the foreclosure path is fairly inexpensive and can go a long way in motivating the borrower to work with you, and you can simply stop there and not proceed with foreclosure.

I think you already knew the answer before you posted and the previous answers gave you a path and you are wasting your time if your seller won't or cant listen.

A good way to start my Real Estate Investing path.

Are there other loan paths I could take with a property like this?

I suggest you move forward with the path of least resistance.

HMM;  IMO, that's a fundamental mistake, just as premature withdrawal from an IRA.You started on a good path with either of these, now let then sit and create another path using REI.

You can read the thread here:http://www.biggerpockets.com/forums/311/topics/185896-wholesaling-llc-to-end-buyer"Cost to set up an LLC is $125 and is pretty straight forward and simple.

I was listening to a podcast at the gym the other day and one of the guest speaker was buying Home Path homes for rental purposes with 10% down and I have never heard of this. 

One path offers the illusion of security and the risks associated with it, the other offers opportunity and the risks associated with it.