I see people lose house all the time for not paying their property taxes.Sell the house to pay off debt before you lose it.Bankruptcy protection will not stop loss of property for unpaid taxes.

You may lose equity and not see CG or have to hold a property longer than you want.

Don’t lose out on opportunities because you didn’t do your homework!

If you’re a flipper, don’t chase your property down as it loses value, just turn it into a rental or sell at break even if value plummets. 

(Your rate should be around 4% for a 5/20 ARM if you are qualified and properties cash flow nicely).Alternatively, if your rates are better than that or you don't want to lose a 30 yr fixed note, I'd just get a commercial mortgage on the new home you are purchasing.

Either way, if your out expectancy is only $900, you will lose all of your money. $900 can be eaten in so many ways - time, repairs, bad contractors. 

I think we will lose buyers overall if fear sets in in regard to future job losses/income/retirement accts drying up etc...

You could lose them. 

If we are now losing $300 per month, that would be the equivalent of letting her stay there 6-10 more months, plus the turnover time of one more month in rent.

Your problem is that in the bank there is 0 chance of them losing any money and with you they could actually lose more than what they put in.If I put 10k in a bank I am certain that 2 years from now I can drive up and pull my 10k back out.If I give 10k to you you could spend my investment either doing a crappy remodel or not even finish the remodel and then walk away.