If I sell the house for what I bought it for net of costs, I would think that there would be $100k in gain + recapture.

DSCR lenders make their own guidelines that can be similar to conventional loan guidelines but are often different as the DSCR lenders generally sell their loans after closing to replenish their cash to investors who have different guidelines depending on the investor pool. 

Although we are targeting good neighborhoods for appreciation and to make sure we get good tenants who maintains the property well and pay rents on time, having a positive cash flow is an absolutely necessary piece to make sure we make money on the investment from the beginning instead of hoping to make money at the end when we decide to sell it.

Is the property you are selling part of the 1031 or have you sold your original property and now buying the exchanged property?

Where it goes wrong is people use it to renovate and sell a property but it takes a lot longer and they get caught paying all the penalties and fees which are a crusher.

Hey Danielle.I'm going to go in a different direction than some of the other commenters.I am an agent, and depending on your state, getting licensed can be a BIG commitment, both time- and cost-wise.I wouldn't recommend getting licensed unless you want to work as a real estate agent, helping people buy and sell properties.

Information is power and there is a lot available for anyone willing to look deep enough.In December 2023, Scranton home prices were up 16.7% compared to last year, selling for a median price of $175K.

I am trying to find out what happens to the property if it doesn't sell at auction. 

Have you identified the properties yet?

This makes cash flowing properties hard to come by imo.Several of my local investor club buddies are sitting on the sidelines, selling some inventory and building a cash hoard.Happy to help with info - as always - do your due diligence and do not blindly listen to some random poster on web sites.Good luck