@Chezare Bonilla this type of question is asked regularly on the forums, so here's my response copied from a previous thread:Before you do anything, it's advisable to study up, get experience, and learn as much as you possibly can about RE.

Now I look forward to my regular workouts. 

Hello,I bought a property last year subject to existing financing.Later I sold this property on owner financing to another buyer.I was making regular payments to the existing loan since i sold the property.Last month I was unable to make the payment to the lender and on further inquiry I found out that the original seller filed a bankruptcy under Chapter 7.What should be the ideal thing to do now ?

Overall, a HUD contract is actually a positive for a bank as it is a much more predictable source of income than regular renters.  

I also tell them straight up that they can probably get more money if they list their house for sale with a regular Realtor.  

@Billie Jo this was more about creating a management co to receive "management fees" that would be established as a S-corp for purposes of employing me and some family members that help me with the business so i could write off employer's portion of FICA taxes and have an ability to purchase group health insurance through the business. my properties are set up in regular LLCs that pass income to me personally as S-corps have double taxation. at least it was my understanding of the tax side.  

I just switched from post cards (1 wholesale deal out of 200+ post cards) to letters (Handwritten font, white notebook paper, #10 envelope, stamps, regular mail) so we'll see how the response to that goes!

If he's regularly innebreated and already not respecting the boundaries you have set forth, kick him out NOW!  

Maybe you could hold out for maximum profit on each deal ($30,000 should not be a goal), but why not find buyers who buy regularly, give them a property that is actually a deal, make your money ($3-6 thousand), and have them coming back for more in the future.

If you can sleep at night having a rental property that is not in your backyard, let the tenants pay it off for you over time.