And in spite of the downturn, the value of my properties is significantly higher than it was when I bought them.

Agree with @Aaron Pfeffer, we have been very happy with the HMLs we have used, in spite of paying 12-14% interest.

The moral is, in spite of assurances from agents that REO’s are automatically clean; don’t buy anything without adequate title insurance.

Yes this depends on some conditions like the terms of the back-tax "loan", but, assuming that the property cash flowed in spite of this, I would have 46k cash more than I started with plus the property.Now my question was, would a bank allow this type of refinance?

First of all, yes, you CAN ABSOLUTELY DO this, even at the "retail" that you casually threw in, in spite of my not saying that you would be buying at retail.

Indy is a great market for high cash flow yields and whether you put any stock in it or not, Indy was rated the #1 market for 10 year return on investment by Inman News in spite of the lower appreciation potential.

@Manraj SinghLooks like you are attached to this property you want to buy, and are trying to rationalize it as an investment by saying that, inspite of a negative cash flow, I benefit because the loss will offset my taxable income.

This is in spite of the fact that the marital settlement already provided for it.

In spite of what I got I felt more comfortable with the construction business.  

Practically all I've learned has come from BP, though some is just plain common sense, which, yeah, I know isn't as common as we'd like it to be.But... in spite of knowing all this, getting an investor to believe I know all this and can follow through... that's the trick.