Real Estate Rewind Starting overhttp://www.biggerpockets.com/files/user/brandonatbp/file/real-estate-rewind-a-biggerpockets-community-bookGood Luck Paul 

The only real estate I have in the SF bay area is my primary home.Since I'll be living in my home for at least 10+ years, I can ride out the ups and downs.In the mean time my strategy as a real estate investor is#1 Pay down principal#2 Ride any appreciation and cash out with refinancing and/or HELOC (multiple times during the time market is up)#3 Use extra cash to buy out of state - linear/positive cash flowing properties.#4 Ride out any down trends...while keep paying down principal.  

Relying strictly on principal pay-down is way to unrewarding for the effort required, in my opinion.

His business ran into trouble which forced him to file for CH7 (Including the mortgage), which has been discharged, so the note has also been discharged.  

Principal and Interest would be $503 and Taxes & Insurance would be $569 a month.

If you can get in to talk to them try and get some pictures to document the condition in case they decide to trash the place you can file vandalism charges against them. 

AFFIDAVIT OF OCCUPANCYApplicant(s) hereby certify and acknowledge that, upon taking title to the real property described above, their occupancy status will be as follows:Primary Residence - Applicant(s)shall occupy, establish, and use the Property as Applicant(s) principal residence within 60 days after closing and shall continue to occupy the Property as Applicant(s) principal residence for at least one year after the date of occupancy, unless Lender otherwise agrees in writing, which consent shall not be unreasonably withheld, or unless extenuating circumstances exist which are beyond Borrower’s control.

Principal and Interest would be $503 and Taxes & Insurance would be $569 a month.

However, they can file suit against you.  

Better yet - pay a little bit MORE per month in principal reduction with each payment, or make 13 payments per year - from the tenant's cash flow.2.