Depends on whether the Feds continue with tapering of QE3 or back off.

They were originally created to allow someone to continue owning an asset even when they were unable to manage that asset for whatever reason.

State RE Commissions examine files closed in Brokerages, they also go to closing companies, I believe holding periods are seven years on site, files are thinned out and contracts and HUD-1, title and other docs are sent to repositories by companies, they use to micro-fiche docs, I'm sure someone scans them now, the history of transactions is not hard to discover.

I am going to do a limited part and continue with polish as the carpet wears out/tenants change.

You have a story to tell and unless there is much more to this story, I can't imagine this preventing you from getting a loan as long as you are ready and willing to put 20%-25% down on the duplex.Your rate will be higher sure, but you can refinance in a few years as your credit continues to improve.Mistakes happen.

I then discovered that if I were to turn the duplex into a house I could make $75k to $90k.

That was before I discovered BiggerPockets, I now have way more ideas if we decide to go on another buying spree.

Should I continue to buy these premiem type homes that rent well and cash flow great but keeping dropping $25-$35K cash per home.

We invested there in 1997 but we felt that in order continue to be effective you need to either set up an office and staff it with your own employees or spend a week per month there (Buying, Fixing and Selling or Renting), then you need Volume to justify your time...

You may be able to hire an off duty officer to go with you.But you can certainly continue with the eviction. :)