If you need financial help, ask under the "Finance, Tax, and Legal" forum.

Ultimately it was sorted because I clarified they legally had a joint responsibility to pay the total rent and there wasn't even an option for "half" the renters to pay late.

I don’t have any legal advice, but maybe some helpful perspective.When we return security deposits, we write the check to all tenants on the lease, such as “Tenant A or Tenant B”.

Quote from @Cheryl Abram: What legal filed docs are LPs entitled to see to help validate a deal's failure?

An LLC is useful for two things: anonymity and legal protection.

Here are a few to watch out for:Property Condition: Most distressed properties need extensive repairs or renovations, which add to your initial investment.Competitive Market: With Phoenix's popularity among investors, competition for the best deals can be intense.Complex Deals: Foreclosures, auctions, or short sales are much more complicated compared to regular real estate transactions and usually require specialized knowledge.Tips to Successfully Navigate the MarketDo Your Research: Understand the local market conditions, including neighborhood trends, property values, and potential rental income.Build a Strong Network: Work with professionals who specialize in distressed properties-such as brokers, contractors, and legal experts-to make the best decisions.Assess Costs Carefully: Factor in the cost of repairs, holding costs, and any potential financing issues when evaluating a property’s profitability.Be Patient: Finding the right distressed property takes time.

It seemed like most the folks you have on staff are CPA or other, but no specific legal experts.

We buy at a discount and pledge our legal right to collect the debt (a collateral assignment agreement) as the collateral for the private capital loan we take out, which is backed by the value of the real estate securing the 1st loan.  

Im no legal expert but belief if you get foreclosed on 2nd home and you still owe money they can come put lien/go after first house.

Quote from @Sarah Ali: The seller has a contract with the agent, which means they can't legally sell the property without compensating the agent.