The other is in the low 500s but stated that this is due to a car accident totaling her car and is in litigation, so she is not paying on the loan. 

I got into the MTR game a few years ago by accident after realizing ABB was more work than I wanted to put into it.

Then with the rest you update it, make sure the staff is tip top, and create more value to increase your monthly revenue.Questions would be; would the management company or key employees stay, any litigation currently, current controls in place for accidents/deaths(then check local guidelines on this), Red flags would be financials and tax returns not matching up, again the accountant should help with this, but definitely request it.

For all those people out there who think an LLC creates protection, they should know it can create problems too.There are times where a sale occurs, but contractually it isn't immediately recorded. 

Does it occur at a specific time of day?

What about your operations has you concerned a serious bodily injury will occur on the premises of one of your properties because in the context of your business that's the most likely trigger event.

California looks at where management and control occur, not just where the property sits.

It will stay as a cloud until the contract closes and both parties file a release; the contract falls apart, settling the dispute, and a mutual agreement to release occurs or a court orders it; the filed memorandum is invalidated for legal reasons.Most title companies will require a release before insuring title. 

., if two violations occur the STR operations can be suspended for up to one year). 

So having an equity cushion is more beneficial.You can absolutely do io and be fine but I'd be banking those cash reserves in case you need that down the line for a cash-in refinance, accidents at the property, or to shore up personal finances.