Now, all real estate is local, but you better check "local" against state and federal requirements, pitfalls and tax matters before going there. 

I would start one from scratch and then convey the properties one at a time into the new series LLC.In terms of the potential pitfalls...Some lawyers are concerned that courts will simply disregard the series structure and open the entire entity to exposure -- even though the statute specifically says that the assets and liabilities are segregated. 

(We have 5 month timeframe)4) Has anyone noticed any common pitfalls of this strategy?

As to catching up on payments, that can be done, but taking title is another issue because that property is now on the lender's radar screen and there is the due-on-sale clause to contend with.Now, if you limit these foreclosure hunts to private foreclosures, some private lender who is not an insured institution, then you might avoid some pitfalls, but still, not all.And, actually, foreclosures are not the goldmine most think, usually there is little equity after all costs.  

The one I had last week ripped as I dried myself.What are the pitfalls of buying a hotel that need to be addressed if she comes back with a yes answer. 

Third biggest problem is not knowing potential pitfalls (which sometimes just comes with time and experience).    

If you have to ask that question, you have no clue to the pitfalls that lie ahead. 

There are quite a few potential pitfalls with dealing with turnkey rentals and a whole myriad of questions that you need to ask.

I guess more of my questions would be based around the note as I am so new at what are the biggest pitfalls I could be missing that could off set that potentially 1mm in profit

Along with reading every @Dion DePaoli post on BP you'll have a sense of the pitfalls in this asset class.