Any other comments relating credit and REI would be much appreciated!

Sounds like a bank sale. they should have terms related to the sale.

A couple points just in case anyone is interested or the thread continues...The mess is confined to his personal space, and is not related to a water leak.  

I'm relatively new to REI.

We would need to assume the loan at a relatively unfavorable rate and put $1.2mm down for a $3.4 - 3.8mm property. 

Doing nothing adds to the tenant's potential arsenal against you, in a liability lawsuit or rent-related legal proceeding.One more element of self interest: water problems never fix themselves.

If you are doing it with a friend its a multi-member LLC  not a single member LLC (unless you just want to do a JV agreement) so your operating agreement should spell everything out.With that being said there are definitely advantages to having an LLC such as financing and sometimes tax related advantages but  if you are not raising money its may not vital to have an LLC though your own situation may vary.

If the market is great, and it would be a relatively cheap turn, I would raise it to market.

I've pulled a prelim and shows NO heirs or devisees, how can I locate someone related or an heir?

Bakersfield still has some good deals and relatively sound fundamentals.