- If banks and majority of hard money lenders wont provide initial draw until after work starts how are you financing rehab work on properties post closing?

They aren't going to say, "well, the neighborhood is going to crap and I'm tired of the vacancies"...instead, "long time owner wants to retire", "need more space", "job transfer", etc.Get a conversation going first on price (via an offer), then work in these inquiries.

I've been considering Texas.I understand that networking with lenders, real estate agents, property managers, and local banks is a must in order to get started.

USAA offered me 60K at 0% for 18 months with a $75max transfer fee. 

Can a new property be purchased within existing living trust without new assessment on transfer?

Further, many are using shorter term, 5 year balloon, bank debt. 

I can see the growth with all the new banks opening up.

We are leaning toward shopping for a mortgage from a bank. 

We purchased a 2nd lien, and by the time it was transfered, we passed the date to file as a secured creditor due to the prior servicers attitude of most will not make it through CH 13, and they are over 2 years into the Ch 13 plan.So we are unsecured and have to wait for it to be dismissed, and we can't foreclose since they are in Ch 13.

The construction loans I know of require 10% down on the final price and they would want money in the bank after closing in case of cost overruns or the property not appraising for the build price.If I were you I would go to open houses of new developments in your area and check out the builders, and their terms.