You've got to decide if you are going to throw in the towel and join the majority or if you're going to ge serious about your retirement and do whatever it takes, even if you have some sleepless nights.

You have a relatively soft real estate market across many parts of the country, subprime lending sucking wind, a recent 1/2 point Fed rate reduction, a weak Dollar and lots of prediction/discussion for either a recession in the short term, or inflation & higher interest rates in the long.What markets are going to be a good deal for you - will really depend how quick of a turn around are you looking on it.

My position is I dont have enough in reserves to qualify for another mortgage since I currently have five mortgages (basically I need about 28k in reserves and a little more for a soft rehab and closing costs to buy it with financing, I have about 18k liquid.).

Once you establish that, you can move on to, "well Jim, what are you looking for if you were to sell this place?"

For tax purposes I assumed it would be a simple capital gains tax on $42,000 however my accountant is concerned that the $122,000 that was paid to Wells Fargo is considered borrowed funds, meaning (I think), when I took the loan out originally, it was not considered income.

The gentleman has absolutely nowhere to go so when he asked if we could give him some time to remain in the property to allow for finding a place to stay, having a soft heart, we agreed and gave him until tomorrow.

The next time I'm going to Wells Fargo, I will ask them for sure about what terms are appropriate for each situation.Thanks.

The thinner vinyl isn't truly floating on the soft underlayment. 

Maybe one of the "soft money" lenders like lima capital?

Most land owners arevery optimistic where they think developers make too much money, they aren't counting soft construction costs, which is a big ticket in CA.