They'll probably perceive it as low-ball - but long story short, always justify and justify some more.Even though you know them, it's best to first think of yourself as a prudent investor rather then shrewd negotiator, and that will help them see you in that "friendly but prudent investor" way.Explain your offer to them.

But they will most likely do nothing regarding any amounts owed (or perceived amunts owed) in the scenario you present.

@Jesse Hyder I do realize that's the way many people perceive Detroit.

I had perceived you as rather conservative with your underwriting (smart guy), well versed in real estate, which you are, so finding out about this Cleveland Heights deal came to me as a surprise.Your post is extremely valuable to many investors, it sheds light on occupancy (although it's due to asset class), city involvement, the Noble stretch, water bills in the Heights, and many more.

Perhaps I'm missing something, such as the average note offering greater return than the average rental property and hence the higher perceived risk?

Hence market perceived risk is higher.  

I've never heard it explained like that before--about a flip remodel being perceived as "new and unused" and therefore worth more in a buyer's eyes.

Some people (not just Christians) get pretty defensive when they perceive that their beliefs are under attack.

According to that complaint here is what comes next:They sell you something after fraudulently inflating its perceived value; lend you the money to acquire something worth significantly less than they represented; put a deed in their pocket in violation of state law; and then they default you, take back the property and rinse and repeat.

As much as I'd love to have everything in entity(ies), I perceive there to be more business risk in doing so than legal risk in not doing so.So, shorter term stuff and new long-term holds are going in an entity.