I'm pretty confident this will take care of my concerns about homeowner liability and the "due on sale" clause.My remaining concern is the risk that negligence carries.

CDOs are instruments backed by the underlying collateral of the mortgage and the mortgage itself remains as a valid and whole transaction and can be foreclosed upon easily.

My quick response from this is all those write downs and short sales and lost dollars arent going to remain lost.

The bank says that thier insurance covers thier remaining interest, but im not sure if it is "rental insurance" or not.

The better part was that he agreed to take $5000 down and carry the remaining $25,000 at 6% interest with it all coming due in 18 months or when the house was built and sold, whichever came first.

One is for replacement of aging items (roof, furnace, stove, etc all have a certain limited projected life expectancy); for these, divide the cost to replace by the remaining useful life in months to get a monthly reserve amount to set aside.

But if there is a quit-claim deed used in transferring the title, then all liens might remain in place.

It is also wise to have a disclosure signed by the seller which states that they understand that the loan is remaining in their name.

This will ensure, as Mike always says it, "you don't kill the goose that lays the golden eggs".You can also buy rentals in highly appreciating markets and sell off half to pay the remaining half off.

If they had the remaining pet run over by a car tomorrow, you could still collect the pet rent but would you want to?