And, this language allows us to draw the conclusion that each series is disregarded under federal tax law, regardless of treatment under state statute.This should be rather simple to fix. 

As long as you take the conservative approach and have plenty of reserves, why not go for it! 

I am guessing the market price for the fixed up house is about $600,000.The foreclosure property is complicated.There are approximately 25+ liens on it, with multiple mortgages, HOA, local property taxes, and federal taxes. 

@Benjamin Papet the primary purpose for BRRRR is to help build your portfolio so the refinancing step is intended to accomplish a couple things: 1) affords you with lowering the cost of debt and 2) most importantly, it provides you with the funds for your next deal, hence the "repeat" step.There is a delicate balance with how much debt and leverage you should have so that is a personal choice based on your affinity for risk and how much reserve you have.  

This will depend more heavily on your relationship with the bank, the financials and reserves of your LLC, and the performance of the asset itself. 

There was and is still a housing shortage so most of us are still wondering, what the, and watching the Banks and REITs that got a margin call and waiting to see if they had enough reserve to cover themselves.

I plan to start my REI business by wholesaling to build up capital for reserves and then, eventually, transition to the flipping and buy-and-hold business. 

But you can only dig so deep on tenants who are already in place - It's not like you can ask for bank statements and credit card balances to confirm each tenant has sufficient reserves to meet the remaining term of their lease - So past performance is no guarantee of future performance.Ultimately, those tenants have a lease that you are contractually obligated to honor (just like they are) until it is terminated one way or the other.

Each one of those areas has some blocks and properties that can make you money, but the neighborhood as a whole is always stuck in a boom/bust and crime cycle that prevents it from really taking off like Fells Point-Federal Hill-Canton. 

Hi @Jacqueline Bustos I would take advantage of the fha loan if you can and leave yourself some cushion in your account for reserves.