(I'm told the original owner is fine with this, as he just wants paid off, and will be paid off via this deal). 

He was fine with this since he got the house for $25k under the appraised value.

Or, the same 27K might represent the downpayment and some expenses on a "lesser" duplex in need of some rehab, which is fine as well, and very much within my wheelhouse.Your idea of renting my current personal residence and buying another house to live in is interesting, and it has crossed my mind once or twice. 

Since everything else was fine and my file was clean it was just the proving of my payments that was a problem.The higher review approved the loan with me providing a signed affidavit about the living situation.So talk to the underwriter and see if there is any way you can get your file "bumped up" the food chain.

In temperate climates like ours, anytime of year is fine.

The TOT regulation includes any structure used for transient sleeping per poses and states that you must register said place and remit taxes or be subject to a misdemeanor and a fine of up to $1K and/or up to 6 months in jail.  

The "balance" that most people are talking are not that important.Pay off your balance in full, in time, and you will be fine.

If you get a good deal on it, great, if you get a fair deal that's fine too. you will have a house that fits your family, your lifestyle, and you will enjoy it for many years.My advice is not to live in a "less desirable area" it will appreciate less and be harder to sell.

I keep fining my way to Austin and I am trying to get more information on the area before I make the 12 hour drive from NM.

Which, if handled right, can be fine but you would need to have a lot of knowledge as to how to make that type of property stay successful.