We keep inventing new instruments and givong them fun names but their use is basically the same And we keep repeating the same cycles.

They primarily invest the reserves in safe debt instruments (treasuries, bonds, mortgages, loans).

Chris has been instrumental in getting me there. 

20 years in the tax business and thousands of clients. 95% of the QB reports we receive from do-it-yourself investors are garbage unsuitable for tax preparation. 75% of "professionally created" QB financials for REI are equally useless.

There are 2 types of judicial foreclosures for voluntary, purchase money security instruments (like promissory notes) against real property: 1) a full suit under the normal rules of civil procedure, and 2) a quasi-judicial foreclosure process initiated under rules 735 and 736 of the Texas Rules of Civil Procedure. 

Maybe a separate thread would be helpful on hedging the interest rate risk of an ARM (i.e. converting the ARM to a FRM using financial instruments), in cases where you're stuck using an ARM because you're funding with a local bank, or one of the other reasons cited.Options that come to mind for a retail investor:1) Short intereste rate futures2) Short a short-duration (1-2 year) bond ETFProblems: hedges don't line up perfectly, might need cash on hand if rates actually move down, cash flow mismatch, etc.Anyone had luck with these approaches.

To me, they were more instrumental in giving me “the team”, mind you at a slightly higher premium of course.

I'm glad you're comparing these to financial instruments, if you buy the right location (car counts, store volume, recent building layout) you can minimize a lot of the risk from tenant defaulting.

Do you care which instrument they play?

You do have the right to continue pursuing foreclosure of the security instrument (mortgage) however at a 40% LTV there are likely to be other bidders.As for someone else giving you a deed-in-lieu, well, that probably won't happen either.