These are all red flags.

However, there is more red-tape with government lending programs, and the seller may be more attracted to cash offers or buyers using conventional bank financing.  

My PM felt the house was clean and nothing raised a red flag on inspection.

Specifically1.1 (shallow) and 1.9 (deep) ug/l.

The prime rate reached 21.5%.The Volcker program triggered a sharp recession from January 1980, five months after he arrived, to July 1980, and then a very deep and painful recession from July 1981 to November 1982—“double dip recessions.”

According to Trulia, it's a relatively safe light green neighborhood, (Midtown is showing up as an dangerous area in red though).

They are not just designing the sub-division, but getting you through a mountain of bureaucracy and red tape.

Interesting that you have a wide breadth of contractors that you rely on, focusing on deep expertise in these areas rather than using general handy-man/contractor.  

Pro's - receive high interest and money secured my the real estate at a deep discount.Con's - borrower defaultingI would think if the borrower declared bankruptcy you would already have a reverse quit claim deed in place to take back the home, your in the first position lien on the property. 3%-5% loan origination fee and 12% - 18% annualized interest.

This would ensure you a safe haven in a downturn.As an aside, the book Debtor Nation: The History of America in Red Ink, Louis Hyman, Ph.D. ’07,  give a fascinating history of the recent phenomena of debt as a right and norm of the american people.