If that note hit my desk I would ask what is the value of the property, what is the first lien amount, is the first lien current, how much does the payor have invested, what is their credit score, what is the rate and payment schedule on the second, why was that second note written with no payments in 5 years, and is their any opportunity for the note be cross-collateralized or the terms modified to be more marketable? 

@Andrew Fehrle Northwest Philly as a whole is a very hot neighborhood, the borders between the suburbs and the city blur while still maintaining the low city taxes that everyone loves.

Payday loans, broken or boarded up Windows, unsavory characters, a lot of trash etc... really indicating you are  on the border or edge of the bad part.  

If you know in advance that your lender will let you remove PMI once you cross that LTV threshold, putting down less money up front and paying down your note faster as you can may be the way to go.

I do have a reserve, however it never crossed my mind that a portion could be used as a CAPEX hedge.

And willing to explore anywhere within the triangle that is bordered by Paris, Waco and Wichita Falls. 

I'll send you a connection request and maybe our paths will cross in our market.

I primary invest in Gaston (Belmont, Gastonia, Mt Holly etc) and Cabarrus county (Concord and Kannapolis)  (they border Charlotte - Mecklenburg) and own rentals in each. 

Fingers crossed! 

If you want to go a bit further, you will find more opportunities in the Fredericksburg area or in Prince Georges County if you cross the river.If you want to consider condos, there are plenty in Arlington - Alexandria within your price range.