Here in Nevada we do have to disclose that we are under contract with the end buyer and we are going to sell they're property for a profit but that normally doesn't raise any flags from the seller.

The neighborhoods that a lot of these properties are in are concerned high risk neighborhoods( Red Light District).

Too many red flags incl age of home and interiors needing work plus large rehab cost. 

You can always say that you are considering making an offer on the property so that you don't raise flags for them to mail you a fine.

I know not all businesses have to be registered with the BBB, but the fact that they aren't was another red flag.

The only thing we need to do is to paint one bedroom (it's blood red) and fill the house. 

Also, seeing nice round numbers is always a red flag to me, it shows me that more research is needed.

The one red flag I think I see is that he is breaking his 24-month lease after 18 months.  

Once it is re-rented do a move out letter itemizing your costs and bill them, but don't expect much.We have a strong non-refundable holding deposit, and red flags should be going off as soon as they fail to hold up their end that early int he contract.

As others have mentioned, if it is an independent motel (not flagged), then banks will typically require around 25% to 40% down.