So, the bank assumedly "bought" the property at a "real" auction because (1) it wasn't happy wtih the bid amount, or (2) it wanted to pursue the owners for the negative equity, and needed the property to sell at the fair market value.That makes me think it is clear this is the primary lien. 

I would work with either, but I settled on Jacksonville because I know Florida better than Dallas, Houston or Memphis, and the properties I bought has the right ROI and purchase price. 

The guy bought the home and did a lot of work in '12.

@Adam Fansler we found one that we signed a contract with for the 3 homes we bought, we are in the process of renovating the first one so we'll see how we like them, thanks for the additional recommendation.

A few years back I bought a 3300sqft single family home for 650k in SilverSpring,MD in a new upscale development that has a mix of townhouses and higher end single family homes (VA loan).

A few years back I bought a 3300sqft single family home for 650k in SilverSpring,MD in a new upscale development that has a mix of townhouses and higher end single family homes (VA loan).

We bought a duplex with a 1 bedroom apartment above us where my sister in law rents.

I have never bought a property at a courthouse auction but see a condo coming up for auction shortly.

If you can get the small multi-family, I'd consider starting out with a conventional mortgage at 5% (when I bought my place, that was the minimum for a conventional non-FHA loan, which gave me a much better interest rate than an FHA - since I had the capital, that was a better option for me).

For example:Everything I bought this year I did it with just 40k out of pocket and I am grossing 10,350/mo!