They were quick to pay when repairs had to be done and their in-house adjusters were on point.  

The SMLLC was treated as a disregarded entity for tax purposes (married filing jointly). 

Is there potential for a lien or some other penalties that I may face if I sell after my property tax is due without paying my 2nd installment?

@Mario MoralesCash-on-cash return measures the amount of cash flow relative to the amount of cash invested in a property investment and is calculated on a pre-tax basis.In theory if your rental income increases by X amount annually due to the rehab while holding your expenses constant so it directly increases your bottom line (cash flow), you can calculate the CoC return by inputting X/$45k (the cost).

(Unless you put down 20-25% and pay the higher NON-owner occupied interest rate .)So yes.

They also come with a 15-20+% tax bill when you sell them.  

Paying 12% would wipe out most profit for me

Hey Jake, If your exit strategy is to pay off the balance asap, I would advise doing a HELOC.But I would consider a traditional refinance if you do not have an exit strategy lined up to pay the balance off immediately  and your blended rate (1st + 2nd Mortgage) is significantly higher than a standard cash out refinance. 

If you lived in your primary residence for the last 2 years of 5 years, you're eligible to sell it and pay no taxes on the first $250K for a single person or $500K for a married couple.

We are currently paying $2,800 per month for a 3 bed, 3 bath home, which is a steal of a deal from our standpoint since most other homes in the area are going for $3,500 per month plus.