. :)Simple Waterfall: after all expenses and reserves, invested dollars get a pref return of x% annualized (annual return in dollars divided by 365 x number of days in the period).

@Ned Carey Since investors rely on the public records search for the Note to find out what is owed on the property through the amortization schedule calculator, it would seem that this is a educated guess so how close is the mortgage debt to the calculation?  

Sooo, I'm currently renovating the existing homes on the lot and getting ready to sub-divide the lot.  

It's all public record.

Is it on public sewer and water?  

Let's do a quick mental model:You can buy a house for $100,000 and pay cashIt rents for $1,000/mo or $12,000 per yearTaxes, insurance, and everything else is $4,000 per year.Your return is 12K-4K or $8K divided by $100K is an 8% return on investmentNow assume someone will lend you $50,000 on any house you buy and charge you 5% interestYou buy two $100,000 houses with that same amount of cashThey each cash flow $1,000 per month or $24,000 per yearTaxes, insurance, and everything else is $8,000 per yearYour gross is now $24K-8K or $16K, less $5K in interest payments You make $11K on a 100K investment or 11% return. 

Would it be considered "Soliciting securities" if I publicly advertise that I'm looking for someone to hold a mortgage on a house for me?

In addition, I'm a notary public in California and I have an ABA approved certificate in paralegal studies as well.  

They said if I did I would have to pay the extra amount divided by the number of people living in the house.

For publicly available deals, there are a bunch of good websites that take MLS listings all over the country and which you don't need your realtor's help to access.