I think the question that you should pose to your advisor is fairly simple, is it possible to extract the third property with out the immediate recognition of taxable gain to yourself.

Ensure that the pre-approval provided by the broker/lender was actually meaningful.

This site is amazing and I am looking forward to connecting with those in a similar boat, a mentor, or even meeting a partner down the road.I am planning on purchasing my first piece of real estate as an owner occupied in a triplex in 2014 and plan on asking a ton of questions in the forums over the next couple of months and engaging in some meaningful discussions.

I am thinking that if I buy a rental for cash and then refi it in a year or so I can extract the cash w/o a tax consequence.

The name calling and generalizations serve no meaningful purpose except to put people down, stifling people that might post for fear of being attacked by someone that thinks differently.  

I choose to go out each day and extract value from the market.Sadly too many agents sit around wondering where the business is and getting one day closer to leaving the business.Best wishes.

I want to be able to analyze the raw data into something meaningful to give me some insight into where the real estate market trends are headed for my area.

Sounds like he wants you to put $5000 up front to pay his attorney to try to extract himself from a foreclosure filing.

@KC Zhang Yeah I'd be interested in this as well, but wouldn't it be more helpful to also extract the crime rating & school rating from Zillow or Trulia?

If it is a decent sum you might want to take the cash now and call it a day.If it's a tiny amount tell them the amount will keep growing with penalties and interest daily and they will be garnished.If they have any money this motivates them to say so.With a small amount you are better off over the long haul extracting the money from them and let the judgement company hound them and go after them.No legal advice.