If you bought the 2nd, and foreclosed the first would still be owed their full balance, and you're back where you started, only months down the line and growing holding costs-taxes, ins., etc. 

Some times they'll make your minimum payment 1% of the balance and on $100k, that could mean a $1,000/month payment regardless of the interest rate. 

Does she own it free & clear, or is there still a balance owed on it by her?

As for rents, ask for what each unit rents, when the lease expires, if a tenant was ever late or has an unpaid balance.

Hi Michael,For retail strips to get the best loans you need to be at  a minimum about 2,500,000 sales price with 25% down and liquid of at least 10% of the loan balance 200,000 to qualify and net worth close to the loan balance.Most of my investor clients are buying up retail strip centers and that is what I am investing in as well for myself.I looked at buying some Papa Johns franchises or Steak N Shake etc. but the gross profit margins run 20% if doing well and I can almost get that with retail strips and stabilized properties.

One concern is that many of these cities depend on military for economic stability and tenant base. 

My guess is that those are being sold at a percentage of Unpaid Principal Balance (UPB).

Are they paid off from the balance of the winning bid at auction?

I do not want to sell the property and but do not currently have the liquid funds to pay off the balance of the mortgage.

Try to have good balance though.