If I was presented with this deal, I'd walk away with no regrets. 

There may be better opportunities potentially, I don't know your area so can't comment but the fact is that you'll be paying down your mortgage by simply managing the property while enjoying rent & property appreciation with equity being built at no cost to you.Assuming 20% down, your returns will far outweigh putting the cash into the stock market.ie. for simple numbers 100K property that you downpay 20K on.

Many commenters have noted the need for someone familiar with taxes and structuring to ensure your investment reaches its full potential.

Is it a legit useful even of just show up of fancy presenters?!

Hi,I have been presented with a very unique and rare opportunity to purchase the home right next door to me in a very hot neighborhood in Austin, TX.

get the heloc on your present home in place  first   so you have it to use  as needed ..the payment from the HELOC  wont  be  included in  dti ratios  unless there is a balance outstanding ……..also  get yourself  pre approved for the  financing for the purchase of the next property  using the  hypothetical  purchase price / loan amt  you want to target and  also with using the  potential HELOC  payment in the mix  to make sure  all is OK for  approval

I agree that an in law wouldn't be the same as a duplex for appraisal, but your comment about it not being legal is inaccurate IMO.

I want to absorb as much knowledge as I can, from like-minded individuals, to become the best investor/agent that I can be.Thank you to everyone here on these forums, whether posters or commenters, all of your words and your advice, truly, does not fall on deaf ears. 

I haven't read every reply but I echo Chris C's comments. $750 in HIckory Hill, run my friend, run away. 

Also, please DO NOT worry about the seller's situation to comment on it; she does NOT care to do anything else, including short sale, other than just letting the house go foreclosed.