Im personally learning towards the brown recycled paper looking one. 

@Glenn Mayo I think what you may be referring to is that some old (and recycled) guru advice was to purchase low interest performing notes at a large discount, and use them to trade for real property getting credit for the note not at what you paid for it, nor at the fair market value, but at the face value of the principal.  

Unfortunately this is normally just recycled product.  

I had a tax attorney tell me that I should continually recycle the LLCs I use to flip houses so that there's no established history for the IRS to base the dealer tax on.

I got my real estate license after I had been doing this for 5 years.....buying, rehabbing, personally owning property, managing dozens of tenants, recycling capital through lenders, negotiating contracts, worrying and planning.I didn't get a license any sooner because I could represent someone with a straight face that I knew what I was doing.Frank

Whereas out of area investors usually end up wondering what the heck they did.. those homes you describe are simply recycled from one failed landlord to the wholesaler who sells to the rehabber who has a TK company that will play in that area sells to the next person who does not understand the realities and the cycle repeats..You talk to anyone who has worked those areas for a decade or more and they will tell you they have bought the same houses 2 or 3 times.TK is great buy at the top of the market not the bottomm

I can't see my next step because all my money will be tied up in equity and that is not a good thing.I have been reading a lot about BRRRR and being able to "recycle cash" and force appreciation. 

If you need to recycle capital and cash-out a value add, a stable property is meaningless.  

If you're trying to get rid of something big or ugly (or both) just remember that there are recyclable opportunities that are good for your wallet!

They are a debt fund, they have a warehouse line of credit from somewhere, or they are relying on the secondary market to buy their loans so they get recycle the money.