You need to consult with a local eviction attorney and spend money getting legal advice before getting in to deep with this property.The bank likely accepted a lower offer knowing how long it would take to get a tenant out. 

I believe buying property at a discount and leasing it with an option to purchase then sell it at retail will be a guaranteed winner.

It is possible to wholesale a short sale and has been done frequently, but the banks are less forgiving now and it is tougher to get material discounts. 

I then told him I would take a discounted rate with seller financing. 

Mark, we meet all your qualifications, have done 28 flips to date and 7 more working on currently, so Inwould qualify if I were in CO.Angela, you would be surprised at the people who sell at a steep discount for instance probates that are full authority no court confirmation needed, and the families just want to sell the property to pay off creditors, and then divide the money amongst the heirs.

However, you're not likely to buy a property that needs such little work at any real discount, so there's no real opportunity for built in equity.

They want $90 for it and it is worth about 89"This could be as simple as: walk away.Or it could mean that they looked up similar houses in the area and decided that their place only needed a "minimal" amount of work, so they put a minor discount on the property; say $97k average for similar places, so they think $90k should entice buyers.You need to clarify what "worth" means, for us and yourself.1. 

If you are a flipper I am open to partnership and can bring discounted properties your way.

I have private money lending at 6% that will fund the rehab and I want to ensure that I am calculating this correctly.Rent - Mortgage - Insurance - Tax - Vacancy(10%) - Maintenance(10%)1350 - 440 - 50 - 210 - 135 - 135 = + 380Cash on Cash return (initial):380x12 = 4,560 / 40,000 (down-payment + rehab) = 11.4%Cash on Cash return (after rehab and appraised at 120k) New Cash Flow using refinancing with 80/20 conventional:1350 - 530 - 50 - 210 - 135 - 135 = +290290x12 = 3480 (per year)Total Cash invested:Down Payment + Interest to Private Lender + Cost to refinance (4% of remaining principal)   24,000+1,200+ 3850 = 29,050New Cash on Cash: 3480 / 29050 = 11.9%Major concerns are not knowing which way the area is trending and not getting any sort of discount on the rehab.Any input would be greatly appreciated.

Guys how would you buy hses with discount rather at retail?