The main reason is people get massively stressed and fear a multi-million dollar settlement and so agree to settle for a few hundred Thousand dollars. 

It depends on your goals and situation.

That's why I stress the importance of building a relationship first.

Not only did the investors lose their equity they lost their cash calls and all the stress that played out over the 3 or 4 years this went on.

You need to understand that given your situation the asset and operational impact must be absolute minimal, lowest risk exposure possible.

if someone needs to borrow a few grand that's a pretty shaky situation.. 

We plan to remove them all to protect from tax increases on our current primary, but I am afraid that now that the other properties won't have homesteads, we may see skyrocketing tax bills and it will eat into already small cash flow from rental income.Does anyone have advice for how to handle this situation other than just increasing rent?

Okay I know I asked a different question earlier but I have another one considering anther situation.

Feel free to message me, I would be glad to give you my opinions on where I think a good market would be based on your financial situation.  

Additionally, don’t overlook the opportunity cost of pulling money from your 401k—those funds could have been compounding in the market.I’d also suggest stress testing your ROI by running scenarios with higher expenses or lower rents to see how resilient the investment is.