At this point they are like an unsecured debtor and will most likely sell that debt of for pennies on the dollar to some national collection agency.

Small Business Administration (SBA) offers 7(a) loans to small businesses for a variety of purposes, including purchasing owner-occupied commercial real estate, refinancing existing debt, or financing equipment.

For example, I am a little concerned about some aspects of the business cycle recovery and a potential for a double-dip so I lean toward the safest part of capital stack which is debt (or low-debt equity).

Curious if the note group leans more towards taking on debt or JV’ing when purchasing?

If a liability arise from inside the LLC, you can lose all the asset in the LLC but it won't propagate to the member/owner's other assets held outside that LLC (fraud and company veil piercing excluded).In case of an outside liability claim, if you own an LLC in a state where the sole remedy is the charging order, a debtor can not reach into your LLC, but just get a charging order against the distribution made, if any.

First, since the debtor is deceased, the lender will short sale the property.

I have no bad debt or hardly any debt, BUT everything is owned by llcs and lenders will not loan.

There are cases where yes, you should pay off your debt prior to investing, and cases where, no, you shouldn't.For example, if you have "bad" debt (debt which is currently delinquent, very high interest - 7 or 8%+), credit card debt, or that which is imminently about to impact your credit) then yes, you need to pay that off before starting in real estate.

The seller (the debtor) may not like the creditor, but the fact of the matter is a judge has determined that she legally owes the creditor money, hence the judgment. 

I've found different lenders calculate DTI ratio when it comes to rental income differently.Some lenders take rental income (or a percentage thereof), subtract the mortgage amount, and then add the result to either the debt or the income.Others add the rental income (or a percentage thereof) to income and the monthly mortgage payment to debt.So, let's say a place rents for $4000, the mortgage is $2000, I make $5000/month, and I've got other debt of $2500/month.So, my DTI without the rental is 50%.Under the first scenario, .