If he were to flake, he's got all the wrath and power of the legal system on his side.

You wouldn't believe how landlord unfriendly the legal system can be here.

if that's legal I would go for that good thinking 

You can also work directly with a tax attorney or CPA who is familiar with these plans.All 401k plans must remain current with changes to the tax code, so you will want to have an ongoing relationship with a legal resource that can provide periodic amendments.The advantage of a quality firm (not just a document provider) that specializes in self-directed Solo 401k plans is that you will have access to training and consulting advice so that you can operate your plan within the framework of the IRS limitations.

Generally speaking, what are the tax implications?  

Ive tried numerous times and ways to contact the appraiser but they havent returned any calls or emails and the bank says they arent legally allowed to speak with them. 

What are the legal ramifications for a private party to  borrow from a private lender at 8% and then turning around and lending that to a rehabber for 14%?

The problem is that they may be related to whatever gave rise to the violations, but this is more of a building department issue, as opposed to the violations, which are more of a legal issue.

I am not sure if this fits into the wholesaling aspect, however in my experience you can probably find an investor that even without going through the legal wholesaling process will pay you a nice finders fee for helping them get into the property.Reach out to me if you would like to hear more.Sam

I read several of his legal-related real estate books in the Rich Dad series and liked his approach.