Think about an insurance company or pension plan.

@Isaac Black Could be a good deal indeed assuming actual owner is current on tax , insurance, hoa and you can pay off the entire note.

These can include existing mortgage payments, insurance, taxes, utilities, HOA fees, etc that occurs during the Rehab period and up until the property is fully rented.  

The real estate attorney who drew up the contract for the sale included that the buyer had to acquire insurance on the property and keep it until the final payment was made. 

No title insurance company will write a policy.

A 30yr loan at 5% for 160k would be about 850/month so add taxes, insurance, maintenance, management, cap ex and as long as your monthly rent is at least $100 more that that, it would probably be a good deal.

I have a rental built in 1905 with a slate roof and no issues with leaking or getting financing / insurance because of that. 

Kind of like  an insurance policy.In the contract, it spells out who pays for what.

She would have insurance, would I need it also? 

You could be a sales person at anything (cars, insurance copiers) etc until you were ready to start investing.