@Jeremy McClure It all depends on your monthly DTI (Debt-to-Income) to see if you can borrow from a bank again.

 * If the seller has debt on it, then it's also an easy way to find a bank crazy enough to lend on it.

Look at auto subprime, student debt subprime, oil subprime.  

I actually attempted to pull out as much as I could get, but because my debt to income ratio was so high 80k was the best they could do for me.  

We use them to pull credit and whatnot.My first guess, and it's 100% A GUESS, would be that a credit report contained something inaccurate, leading to someone issuing a loan they otherwise wouldn't have, which in turn resulted in corelogic being sued, which in turn resulted in a settlement that involved them covering the prop taxes.Again, 100% a guess.

My original thought is to pay off the rental ($45k) because the 700 month after expenses is a better return than .75% in a savings account.After reading similar threads here, others would argue pay off your personal debt and let renters pay down the other mortgage.  

Banks are at their old games again... loaning to people who shouldn't be buying houses, underwriting amounts that are outrageous and packaging and selling of off mortgages based on debt class.When I appraise a house I toss out the outliers (the lowest and highest sold) I then use comps like anyone else would.  

The $ 3,500 figure is figured at closer to 5% for management and does not include debt payment.  

Besides, my opinions on what's wrong with the property, the only way to make this property cash flow positive is increase your down payment to 30 to 35%, this way your debt service will become smaller than your rental income and you'll start earning a $25 a month of positive cash flow.Austin is a tough market, if you are going for newer properties.

Richard, i think that is a great thing to do for your parents and is a good plan. if you have any siblings, just make sure you get everything in writing about the deal and that you will pay off the debt in the mean time and that it will be yours, just to avoid any future arguments.