So in year 1, your account value is great compared to what you invested (25% gain), year 2 is still very good (25% on the contributions, plus 5% on the previous balance = 17% average).

Financials:Purchase price (2001): 155kMarket value: 305kMortgage balance: 300k (1st 132k, 2nd 168k)Mortgage (P&I): 2100Rent: 1795Mgmt Fees: 142Pool Maintenance: 120Taxes and Insurance: 190Cash flow: -800And how my CPA is calculating taxes (this is assuming net proceeds of 296k):Basis: 125,600Gain: 170,400Rental activity loss carryover: 15kTaxes: 39,200 (Fed: 31600, State: 7600.  50k in my original post was incorrect.  

The danger is the bidding at the first's auction not exceeding both loan balances. 

Also, be sure to do a full walk through and make note of the condition of the property so that if any damage occurs during the balance of her tenancy you will have recourse.  

@Shital ThakkarI don't really see housing prices coming down in the next several years, but the report does indicate that the frantic pace of price increases should start to slow.At least in Dallas County, housing demand (closed sales) has come down year over year, but supply (new listings) has also come down by about the same amount, so it seems relatively balanced for now.

Instead of waiting to pay down my balance on the credit card I just got a new one.

Miguel "Mike" Perez Actually their prohibition on short sales to family members/related parties is purely an attempted safeguard to avoid "sweet heart deals" where they may get less than market value, and if it were allowed it would also encourage many to try and get rid of part of their loan balance by simply running it thru a family member in a short sale, and essentially retaining the property.  

They can only deposit into the account, not see balances or withdraw, so don't see a risk.We also let tenants bring rent to our house.  

The hard part is balancing the obsession with my time and studies.

As a neophyte RE Investor -actually, I'm still researching-, it seems there could be a good balance between both worlds.