Perhaps you can equity strip and refi to keep equity exposure to $1M, but these are considerations worth having now if you have the purchasing power you’re suggesting.

You could use the equity from the sale to get back on track financially and reinvest in a more manageable property to kickstart your investing journey.

Are properties such as this more appealing to buyers with renters already on leases or will I get more interest and a higher sales price if I sell the property vacant?  

But for judgements liens and all that who cares they are snuffed out at the sale.

I have no house and no money from the sale!

Look at purchase HUDS, statement of work if it was a renovation and the sale HUD to make sure they made money on the deal.An organized and easy to navigate borrower's package.Security documents to collateralize the loan against real, tangible property.I also like to throw in some communication clauses with consequences for ghosting.Cheers!

They have a great sales pitch, but rush to sign you up and not much after that.

Drivable to the Bay Area, much lower property taxes (that DON'T reassess on the sale), much friendlier tenant/landlord laws, strong population and job growth, strong appreciation, and also anchored by the tourism and wealth of Lake Tahoe. 

@Rud Sev Your Section 1231 losses from the sale of rental properties were likely correctly reported on Form 4797 (Part I) as ordinary losses, allowing them to offset all types of income.

For example, I am not really cut out for marketing and sales so I partnered with someone who is 10x better than me at it.