This creates a negative initial position.

In a short sale with a partial claim, your first lien position with the FHA loan takes the loss so the claim can be paid in full.

@Nold R.In addition to the great post from Dave, possibly consider an option where the property is taken out of the LLC sooner rather than later and held as tenants-in-common prior to the sale, possibly setting you up in a position to take your share of the proceeds and individually purchase a replacement property via 1031 exchange. 

Hi,If I buy a apartment doing a seller carry back, how do I explain to the seller how they are protected if they carry a 2nd position note subordinate to the bank?

After 8 years as a director in the kitchen and bath retail space, I'm bringing my positive energy and relationship building to a wholesaling firm covering Los Angeles and San Diego counties (we specialize in single family homes priced between $400-$1.7M).

On the one hand, I can see it as a positive indicator, for example of market health and increasing suburbanization. 

For me it’s been one of the best ways to get positive cash flow- hands down.

Positive cash flow is desired but that is not my primary goal.

Is your income in a place that you could fund that for awhile until rents catch up and make it positive? 

With $40k saved, you’re in a strong position to consider options like house hacking, BRRRRs, or partnering with others to maximize your investment.