Historic Home w/ Tax Lien and Possible Seller Financing

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Hey BP! 

I have a unique opportunity — my parents own a home in a National Historic Registry site. The house has a lot of deferred maintenance and now has a tax lien. I know it's worth significantly more with some work, which they are now not in the situation to do. Since they are my parents, and own the home free and clear, they are in a position to seller finance (I think). 

So my question is, first, can they even seller finance with a tax lien? (property is in PA). And second, what is the play here? I was thinking it could make a great rental (much sought after location). 

How would you structure a deal with little or no money down, with some sort of loan for repairs? Would it be possible to put the house under contract, get a loan for repairs based off the value of the home, and then begin payments once I have a renter in place? 

Home is probably worth $650-700k ARV, probably needs 100-150k worth of work, and I could probably get $3300 / mo in rent.

There should not be an issue in selling the home with the tax lien on it.  It would be required to be paid off at or before the closing on the sale.  You may avoid delays in closing if it is paid off beforehand.  Be sure to check with the tax office to see what the total amount due is.  There may be penalties and interest that are not included in sources posted online.

A lender that does the standard underwriting would require the tax lien to be paid off before lending the money as well.  Again, this could be done in the closing process.