It gets even better because it's likely you didn't pay any tax on the $10,000 because of the depreciation offset and if you reinvest the principal and/or proceeds you can avoid paying take on the $25,000 gain as well. 

Reinvest the proceeds into another property.

this is actually quite common or lets say if you do a lot of court house work you will run into this one to 3 times a year. some pre foreclosure company beat you to it.

With 780+ credit and 40% down coming from our own home sale proceeds, using our current lender's "customer for life" program to re-apply, and with perfect payment performance over 8 years with them, is the 28% front end DTI written in stone, or is there flexibility?

Recently, we sold our interest in a project and decided to 1031 the proceeds ($1.87mm) into a multifamily property.

Recently, we sold our interest in a project and decided to 1031 the proceeds ($1.87mm) into a multifamily property.

In that same writing, tell the taxpayer they have ten calendar days to tender payment or you will proceed with improvements and the redemption cost will continue to increase.If they start the official dispute process by appointing a referee, you will have to wait until the end of that process, and then send a new notice with a new ten day deadline.

In that same writing, tell the taxpayer they have ten calendar days to tender payment or you will proceed with improvements and the redemption cost will continue to increase.If they start the official dispute process by appointing a referee, you will have to wait until the end of that process, and then send a new notice with a new ten day deadline.

It was a way to turn a profit and be able to use the proceeds to buy more real estate.How did you find this deal and how did you negotiate it?

However, I would be prepared to proceed no matter how they respond.