The section of Nashville over by Jefferson Street IS a very hit or miss area but the nice thing about it is that it's directly adjacent to some very nicer areas of town like downtown, Germantown, the gulch, etc.

Can you elaborate on which direction you think/plan on taking?

Having the money specifically allocated to a reserve account instead of having it directly contribute to rent is imperative. 

If i satisfied the mortgage, there would be another 40k lien i would have to satisfy so its not worth to buy it directly from the bank.  

You'll probably pay fees and it'll be tougher to find a bank that would be willing to pull cash out for reasons other than direct improvements to the property. 

There are likely other creative options, but perhaps you can buy cash with your next purchase and then lever up after you’ve clear your PAL bank.

First off, being nervous in this situation is normal, but I have found that the more direct and transparent you can be, the easier the situation gets.  

Just be a little more frugal in life. ps I dont think you need to be creative, just cut back "un poquito"

A Beneficial Owner is an individual who either directly or indirectly owns or controls a company.

Let us know how it goes and which direction you choose