Hard money loan is an option but curious as to if there are any less expensive alternatives.

Sticker shock of housing in the DC/Arlington area has reminded me that there are alternatives to paying retail and I am looking for opportunities in housing where significant value can be achieved.I am looking for a distressed condo to own/occupy for 2-3 years and to eventually become a rental property.  

A winning bidder MUST run through all the specific alternatives to foreclosure before initiating foreclosure as a last resort.  

I think you should have an least one alternative exit strategy regardless of what you plan to do with the property.

Another alternative to the lease option idea is to get the lease option in your possession and then find an end user who wants to buy the property down the road.

I will at least see if the owner is willing to assist with the eviction process, but if not, it's good to have an alternative plan.

He highly encouraged us to acquire the property and build out the original plan, but also acknowledged that there is an approved alternative to build out 271 apartment units.

One alternative that was made available to me was just setting up a partnership with both my mother and my uncle and have umbrella insurance covering everything, but I am stuck on the legal aspect of this should any of the tenants chose to sue us down the road. 

However, if the borrower does not cure the default, and no alternative workout plan is put in place we will consider starting foreclosure.

Alternatively, you could try "cash for keys"  where you pay the tenant to leave, if he'll leave by friday and leave the unit in good condition.