Another thought is that if you do move into the townhome and live in it for two years, you can then sell and have a tax free gain.

Good rentals don't actually generate passive losses.

The other aspect is while some deductions and strategies might be legal they GREATLY increase your chance of an audit.If the payoff is small then risking an increased audit for the small gain might not be worth it.You need to have this discussion with your tax professional.no legal advice

Apartment investing is by no means a passive investment for someone with no experience.

So, way the pain vs gain into your plan and wealth goals and make the decision based on the numbers rather than emotion.

Lenders often access the data base called the AVM. I know they use it for lending under Harp and other programs used to refinance. I suspect they use this or a program like this for initial valuation for short sales a...

Talk to the neighbors if you can, I find this is always helpful to gain info.

If I remember in basic accounting classes, if you buy back debt you owe at a lesser value than what it was issued at, that is considered a financial gain in the IRS' eyes and we know what the IRS does to financial gains.I'm not 100% sure, that's why I would think its worth a few hundred bucks to find out from a professional.

The partnership will need to file a tax return and send each of you a K1 for your share of the gains or losses.I would recommend you spend some time and write down how you're going to run the business.

The benefits do not outweigh the risks to me.If they sue you and go to court the money you gained will be wiped out in court costs and then some along with a bunch of time wasted.Also you will have a hard time proving the items belong to the tenant.They could have a loan on them,be borrowed from a friend,or other people staying there not on the lease could say it belongs to them.This happens in judgements too.You get a judgement and before garnishment you have the defendant fill out an interogattory questionaire from the court.Do you think people are going to list a 2,000 tv when they know you are after it??