People are buying houses well over the market price and with a surplus of rentals just now rent is being slashed. 

I assume the owner would be entitled to the surplus $35k in this case as @Brent Coombs mentions, so the "net" they should have to come up with would be the $6k plus fees, and perhaps interest on the bidders $45k.  

its social and functional obsoleteness at play.. along with supply and demand  more housing than good renters or buyers.. this is what happened in Detroit.. 50k surplus homes..

While you won't make much money doing so, it sounds like you're barely cashflowing it, and your monthly gross surplus isn't sufficient to build a reserve for vacancies and the maintenance you're going to require in the short term.I'd hold onto the Springdale property.  

If not OTC sales, then there could be surplus sales.

The population decline isn't enough to create a housing surplus, especially in the nice areas of town.

If the LLC defaults on the loan for some reason Blake would assume ownership of the property on his own. 10.In addition to paying Blake’s IRA the mortgage each month the LLC would also be paying his IRA half of the surplus in the LLC’s bank account that is exceeds the amount we have determined to leave in reserves for capital expenditures.11.The other half of profit would be distributed to me once per year as well.

Hopefully you have those surpluses saved as reserves.

You can almost always pay down principal if you have surplus cash and want to pay off the note early.

If I enter that manually, the results tell me that I have a $0 down payment and a surplus = to the rehab amount.