A SMLLC is a pass through entity and the IRS doesn't recognize it as a business if used for real estate investments.  

Yep, even the IRS recognizes the benefits of the Trust Transfer™.

After you get a few deals under your belt you'll start to recognize the difference between "properties that are for sale" and "properties that NEED to be sold". 

It sounds like you recognized the red flags fairly early on, yet you decided to proceed with things until the red flags become too numerous.

It may very well be, but I'd guess that this behavior is recognized as undesirable for lienholders because no one will bid the properties at the auction because this sort of behavior discourages it.  

If your mortgage was FHA then LTV would only be recognized from the original value.

That being said, there is a lot of competition at the auctions these days and the chance of an "amazing deal" not being recognized and bid on (and probably bid way up) is slim to none in my experience.If you're interested in auctions though, there's nothing wrong with going to watch and see how it works so you'll be more prepared when you have the money to be an actual bidder. 

Forming a series LLC (assuming your state recognizes them) will also make life easier on you.

I can't tell you how many books & tapes I've bought on shiny real estate things :) Pat yourself on the back for recognizing the danger, and pick one or two things to start with and learn the ropes on.

We also recognize the growing potential for rentals right now, with increasing infrastructure in west bremerton, the development of the Trails complex in Silverdale and the expansion of the bucklin hill bridge.