There is a pre-foreclosure property headed to auction at the courthouse steps that I'm very interested in purchasing.  I've sent a couple mailings to the private owners with no response.  I've also called a landline n...

Your income will be on the capital gains and (assuming they were rental properties for the past 4 years) the recapture of the depreciation expenses allowed or allowable when the properties were rented.You can't avoid the tax by re-investing unless you establish a 1031 exchange prior to the sale.

You should use limited warranty deeds to transfer the rentals from your personal name into your LLC, put all rents into the business account and buy a good umbrella policy for liability protection.

If I'm gonna hit a roadblock there, then a title search/insurance policy would just be a waste of money. 

Purchase 125K plus 25K repairsWould sell now ~215-220KOwe 85K - 5% rate used HELOC from primary home Rent $1550-1600/moHOA $275/moinsurance $200/mo includes flood policy $600/yearRE taxes $200/moManagement $155/mo

California has one of the most aggressive and broad tax policies in the nation in this area. 

Current or prior ownership of real estate: only primary residenceValue of property at present and/or your offer price: $790k asking, I’m looking to buy for <$650kAnticipated or actual appraisal issues: noDown payment or equity: we could put up to approx. $120k, but would like to do $75k down and keep about $45k for remodel unless we can finance itSource of down payment funds, if applicable: current home proceedsIncome Source: Salaried plus commissions/bonus - but both wife and I have to qualify with base pay only since we do not have two years at current employers.FICO: ExcellentI think seller financing the whole thing is too risky to us (seller wants $100k down and balloon in 5 years).

If not, you may ask an owner to make one prior to sale.

If the departing tenant is owed any portion of the deposit, he is to work that out between the remaining tenants prior to departure.

The only downside to this whole situation is now you have to send a different contractor to work on her unit to avoid a potential confrontation which sort of stinks considering you have a 15 year history with the contractor.From what I know is there is no prior history with any of the tenants on the property.