They just document what they are directed to do by you as the account holder.  

                   - HUD did an audit of the SEC 8 office a few years back as a result of a tenant in city housing suing and discovered the Housing Authority had over $1M of HUD money that was intended for help voucher holders just sitting in their bank account

To the extent you screen and get referrals for PMs, there's nothing like experience with them to figure out whether they're a match.As a holder, I wouldn't be as concerned with your buy/rehab price a little time will heal these wounds quickly.  

In the scenario you describe, the 2nd lien holder would want to pay off the first since they have the most to lose.

Please be aware that we will not execute any lease until the Security Deposit is received.4) Keys: Because of federal privacy and identity theft laws, each Applicant will be REQUIRED to provide copies of positive identification (at least one with a photo) such as Driver's License, Passport, Visa, etc. 

That also includes verifying that the tax claim bureau did what they were supposed to do as far as giving the proper notification to lien holders and the current owner.  

You're attempting to create interest in the sale, rather than chilling it, which can only benefit the borrower and subordinate lien holders, since they and not you would receive any amounts over and above what's owed on your lien. 

You want get a loan that you pay off the line holder with appreciation in the future?  

Over half of mortgage holders in the US are paying less than 4% interest.This has the effect of “trapping” many would-be home sellers and subsequent home buyers in their current homes.

As an equity holder, the current income comes on a K-1, so you'll get your share of the depreciation tax benefits like you would on property you own yourself.Of course, there's lots of details to understand about the skillset of the sponsor, risks involved in the particular property or portfolio, as well as exit timing and strategy.