After you get 22% equity, by a combination of paying down the mortgage and appreciation, you can apply and have it eliminated.

In addition to the obvious contribution limitations, the dangers of self-dealing, and general ease of “messing up,” a self-directed retirement plan also eliminates the ability to take advantage of significant real estate benefits as depreciation and many business deductions.Jeff

You may want to contact your bank and find out about HARP , it's a govt program that if I recall correctly can eliminate the upside down amount on the mortgage .

If the seller's BK eliminated the debt on the house, there is little benefit to them in a short sale.

I was also told a gap funder usually wants 50% of the proceeds from a sale so we eliminated this option as well.

To further eliminate your concern, I would say that I doubt they are buying in Virgina, they are almost exclusively focused on the sand States.

Using a trust vehicle eliminates any non assignability issues, and avoids additional costs with a double close.

That would eliminate the need to raise cash now to buy it.

There's a law of diminishing returns to how much risk is eliminated as you increase the reserves.

I know this is an old topic, but new NC law has legislatively eliminated L3C out of existence.