There are a couple of things that come to mind, if a payment is missed the lender cares, if the servicer goes out of business or misses a substitution of trustee, the lender cares, if the borrower goes to the lender to try to get removed from the loan (usually to buy another house) the lender cares, if the property gets caught up in a bankruptcy or divorce, the court cares and that means the lender gets involved.

($5,000 / 1% = $500,000) --SeanHi Sean, a couple quick points: 1.

I had a plumber inspect the furnace a couple of months ago and said it was in good shape.

After a couple of months of hard work and more than a few unexpected surprises during rehab, I sold the property for $145,000.

After a couple of months of hard work and more than a few unexpected surprises during rehab, I sold the property for $145,000.

There are lots of hard money options (or maybe not "lots" but not too uncommon) with no appraisal required - that makes the offer equivalent to cash (closing within a couple days and no appraisal contingency - its out there)The lender still has to ok the deal, appraisal or not.

Someone sent me a couple of links you may find useful.

If the market value mentioned above is accurate and the “initial” loan balance hasn’t increased by rehab funding, I wrote above that the proceeds are just a couple million after closing costs and commissions.

It's a good way to marry rehabbing distressed real estate equity capture with long term note income for retirement accounts for those that are interested.

Quote from @Richard Kim: I'm a fairly new small time out of state investor who owns a couple multi-family properties in Cleveland.