Hello Over the past 7 years I have had 2 REO houses from Washington Mutual.

If the person has a beneficial interest or other stake then the person could lost that interest.

Talk to your tax professional to make sure you meet the criteria.If you don't meet the criteria, it's a "passive" loss, and can only be used to offset "passive" income, stuff like mutual fund and stock dividents.

Would it not be a good idea to take some of the money left over from a refi or HELOC after buying my next investment property and saving a little, and then taking about 5K and buing mutual funds.

Would it be beneficial for us to start the business before we start our first rehab project... to protect our personal liability, or should we wait?

If you don't have time RE really isn't for you....If you wanna plop down money and have it earn for you without doing much work and is something you can do online try an ETrade account and some mutual funds.

Well I wouldn't put the proceeds in the "bank" at interest, I'd invest it in mutual funds.

I am assuming you would compare everything to a risk-free type investment like a CD or Savings Account and additionally maybe something like a mutual index fund for your analysis.For me, I believe I would normally pay somewhere between 700-900 on rent not including utilities.

Or a reit mutual fund.

These include some mutual funds, rental property, and – our friend – international preconstruction investing, too.