They were in debt with their bank with about two years of non payments.

In a worst case, they can foreclose on other property you own to satisfy this debt though it rarely happens.

for me, my ex had been spending like mad, the good side of this for me was, though I was left with a lot of debt, this made it easy for me to buy her out on a lot of things.

Plus they also look at debt to income ratio. 

For tax purposes, you also deduct the interest portion of the debt service you paid in the year (only the interest portion, the mortgage principal paid is not an expense).  

He had 200 units with zero debt.

It currently rents for $850, which is under market for this neighborhood (market is probably $950).With taxes, insurance, debt service, management expenses, 10% for maintenance, 10% for capital expenditures, and 10% figured in for vacancy, I'm calculating a current cash flow of $90 / month based on the $850 rent.I know that's not stellar, but here's why I like it:The neighborhood is one of those neighborhoods I really believe in -- it is minutes to downtown, and central to major redevelopment and transit projects in my city (Atlanta), and it may just be one of these hot neighborhoods that becomes one of the great places to live.Right now, this is the cheapest on-market property in the neighborhood -- the closest comps are in the 85-95K range, and several flips (not comps, but nicer houses on the same block) have sold in the $200K range in the past month.

When looking at Portfolio Lenders you have two types of transactions: (1) Purchase; or, (2) Refinance.(1) When looking at a PURCHASE, you should expect to get up to 75% of the Purchase Price of the property...assuming the DCR (debt coverage ratio) can be supported by the cash flow of the property.  

Last advice: make sure to have good records an accurate / current data tape - not every loan is based on lender qualifications and LTV/LTC  - normally, the DSCR (debt service coverage ratio) carries a large weight in the overall risk profile.Much Luck!

Not sure that I will qualify using Tax Returns due to high debt to income/and real estate investments.Asset backed loans (no income verification) are 5-6%, a little higher than I would like.