Here's a summary of the economics.They purchased the property for $280,000 in 2004.The loan balance is about $178k.Monthly principal and interest payment is about $1,265 with $709 currently going to interestProperty taxes are $4,116 annually and insurance is $1,000.Currently the house is vacant for the sale so there's no rental income.Therefore, the monthly burn is -$1,135 (ouch).For the sale:Property was originally listed at $335k and they received 0 offers at that price. 

Currently there's about $345k left on the loan balance.

I had read somewhere that you can roll lawyer costs (title, etc) into basis cost as well as origination fee and deduct for life of the loan.

I have also bought a contract from another investor that had a property he contracted sub2 the underlying loan.

You lose the tax advantage,  but that's the same with any loan. 

Hi BP, newbie & I’m looking for a note servicing center in California for one loan.

Loan from a family member How did you add value to the deal?

Just to make it simpler to understand.So you took out a personal loan of $10k and you loan that to the business for the escrow at closingOn your balance sheet you would haveDebit Escrow Account $10KCredit Due to Rob $10KAs for the interest, the business will pay the interest exp payable to Rob (since you are the one who will actually pay the interest).

Someone needs to catch up the payments or one of the heirs can attempt to get a loan modification.

I can pay the loan back in 8 months.