The weird part is that the tax search website did not show a lien or pre-forclosure or any foreclosure history on the property and 99% of the time when a loan is in default I can see that.After searching the Dep. of Finance I also found that the taxes have not been paid for over a year and are still outstanding. 

The longer you have the loan outstanding the worse the tax/performance impacts on your retirement.

Some plans will not let you contribute to a plan while you have an outstanding loan.  

It's underwater, and total outstanding debt is $300k.A few things I'm wondering:Was the $140k starting bid at auction just a teaser rate and the reserve would have been much higher?

Why dont you get a heloc and pay off your other outstanding debt?

As another side note, you best keep an eye on those outstanding tax certificates as they at a point where they can petition for a tax foreclosure for lack of payment.  

However, to you as the investor the best options are to buy for cash or buy with seller financing where both methods are structured to satisfy the outstanding taxes.

The customer service has been outstanding and responsive.  

.- - - - - We are clear in our rental agreement about how we apply money received:"PAYMENTS.All payments made by Tenant to Landlord after the tenancy commences, no matter how designated by Tenant, will be applied as follows: first, to any outstanding amounts due for damages/repairs, utilities etc.; second, to any outstanding service charges or fees from prior months; third, to any rent outstanding from prior months; fourth, to any service charges or fees due in the current month; and lastly to the current month’s rent

Without an outstanding PM on the ground I wouldn't do it.