And lets say 6 months later, the owner redeems the property.  

One strategy you may want to think about is buying a home during the owner occ period. 

Sure, take 10,000 homes bought by investors, and do regression analysis that gives me an indication of variables that are common, like geographic area, home value, home owner's age, income level, political persuasion, gender, ethnicity, or anything else!

Expenses approx $30,000Asking price is $900k, however I learned the owner owes only $120k.

Also if you story is that you're trying to be an investor that story if considered is beatable by a home owner looking to secure for their family.

Is it truly "passive income" if you find the right PM or is there always work to be done by the owner?

However, previous owner owns only about 60K to the bank.

HUD home built in 1900 in nice historic district of Ohio town.  Listed at $70k then dropped to $63k. Contemplating a bid of $55k.  ARV roughly estimated at $130k-$150k.  Extensive repairs needed, estimated between $30...

Is there anyway where the lender wouldn't have to be partial owner in order for this to work?

I'd had the assumption that i'd buy a rental using a HELOC on my primary residence, and then financing subsequent rentals with a LOC/leverage on that rental property (something I assumed the majority of rental owners are doing now).