If the economy slows down further and unemployment begins to rise, I believe that their hand will be forced to an extent and the FED will need to put some attention on those figures.

Buy the rock solid rental and get your appreciation, cash flow, depreciation, principal pay down, equity capture on a discounted by and forced appreciation gain for a well targeted rehab.  

IT Business:With $250k in cash savings and significant untapped equity in your rentals, you’re in a strong position to leverage your existing real estate knowledge to grow your portfolio further.The real estate market, particularly with your ability to do your own rehabs, might provide you with more immediate and scalable opportunities for wealth building, especially if you can find properties that need work and force appreciation through value-add strategies.Balancing Both:You don’t necessarily have to give up the IT business entirely.

If the owner doesn't redeem then you have to sue to quiet title and force the sale of the property which you will then only get back 1% of what it is sold for.

The only way that the total balance matters is if you are somehow forced to sell the property shortly after buying it, and are thus underwater. 

So incurring the fewest expenses is the cheapest exit plan.There is no tax advantage to refinancing the property first - in fact, the refi will often force the taxing authority to reassess the value of the property - which would likely remove any tax grandfathering you may have - raising your taxes.There is no advantage to doing a two step process like you mention.Randy

If you got greedy like all of the SFH who got foreclosed using ARMS years ago. 

Do small value adds to force equity.

That cost could force you to walk away.

We can point to the recent acquisition of Fox by Disney, where they were forced to sell certain assets in order to complete the merger.