You need credit, income, knowledge/experience, collateral and assets to be considered for financing in RE, if you lack in one area, you need to compensate in another area, but the ability to repay and collareal can't be completly overcome with other aspects.

Sure would be nice to have a clear cut answer to that, but there is not.There are too many variables involved, remaing term, credit, seasoning and proven payment history, collateral, loan to value, property condition and the details of the contract including the security assignement and foreclsoure process.Best to get bids, and look in your area for other investors, including those who buy RE, your best deal might well be from a local individual looking for a good investment.

$100,000 in cash/assets because that covers collateral for the house and some wiggle room?

however i was thinking about using the equity or the home as collateral for a down payment on a new property which i also hope to rent out.

Just because you can or could do something doesn't mean you should for the sake of razzel dazzle....You don't try force something to make a deal out of every property.The straight forward method here is for you to get a loan to pay off the tax bill, she subordinates the property for collateral for the loan, then you buy it and she finances the balance, but even that is probably too much brain damage, unless there aren't any other deals to be had.

Accredited investors are or should be required, few small offices can accomplish that now and the structure needs to be compliant.Where brokers or even partners get in trouble is assigning collateral to a group to secure the funds, someone will be last to recover thier money and if there are insufficient funds, they or someone will lose.As a broker, you really need to be in a position to take any investor out of a deal, you also need to be able to take out the small investors who lack experience as they yell the loudest and it makes an attorney fight harder for the one at a disadvantage.

For you currently, you could make the argument for rental property and liquidation of collateral.

If you charish your friendship, do NOT provide the financing for a long list of issues.In in particular, you must treat them as if they are strangers when it comes to collecting payments and taking care of the collateral.

The investor is secured because he maintained the real estate as collateral.

Ask your lender their thoughts and position of tax liens on collateral.