Let's use this scenario: Ohio property - $90K FMV/appraisal (for sake of this example)Senior/1st Lien - $50KJunior/2nd Lien - $25K (this is what I'm buying)Total Equity - $15K ($100K - $50K - $25K)The borrower isn't willing to work out a loan modification so I foreclose.

That seems like it'd be a tough thing to work out without a trusted intermediary 

Just make sure you have a back up plan in case things don't work out. 

Real estate is a powerful tool, and many times can work out to be more advantageous than the stock market.

However, it sounds like you live close enough to your properties that perhaps this arrangement will workout.

It's always a great sense of accomplishment in a mental boost when you finish a workout.

Is this strategy really going to work out in your favor 100% of the time?

You can sometimes work out bulk rates with a company that will lower your costs but whenever you buy from a public auction, you are taking some risk because you are buying as is with no guarantee about the condition of the house or the title.

It is somewhat of a hack as there is also a building on the property that my wife will continue to work out of.

Sometimes you can work out no money down, but expect to pay higher rates.Owner financing isn't like getting a bank loan.