A Tax Audit is not fun, and even if you have to pay a small penalty, it will bring the blood pressure up.  

The nephew (sole blood relative) has never lived in the house.

Typically landlords would describe emergency repair requests along the line of involving "fire, flood or blood" (if this helps).One would assume that a tenant with a lousy credit score, two pitbulls and a yearly income that places her on poverty status would be grateful any landlord would rent to her. 

What percent of the market value would be too rich for your blood regarding the lien amount?

Mostly blood, maybe some grey matter.

Since you are related by blood, you would still be eligible for the normal maximum LTV.

It's in my blood.

I want to put the blood and sweat in - and certainly will.All-in-all, I am seeking general advice from someone who lives there and can point me in a helpful direction.

I saw water rights (no land) for sale on 40 acres near Greeley being sold for $1.6 million earlier this week.Folks don't agree with me, but Denver Metro is tough to make money on at the moment - it's like squeezing blood from a turnip.I bought a house about two years ago in Fort Morgan - bank foreclosure for $22,500. 

But, again, it's all about what your goals are for this investment, and how much time/energy/blood/sweat/tears you're willing to put in to make it work.