You’ll have trouble cash flowing new construction homes unless you put down a large down payment with a great rate.

That is a essentially a bailout loan because the debt is restructured and they are saved from foreclosure as long as they make their payments.

-Maximize leveraging the lender's money by taking advantage of lower primary-occupant down payment and interest rates (DP 0-5% vs. 20-25%, Mortgage rate 7% vs. 8%+).

Depending on your location, property type and down payment, you might be able to lower your current living expenses. 

We would then need to claim this "income" on our taxes and pay self-employment tax on this amount even though we never received payment for anything. 

@Dave Versch  The process for the counties I invest in work this way;Same bidding method - you bid down the rate in full 1% increments from 16% down to 0%. 

Are you aware of any tool/method?

Some things to consider:* usually used for single family or 2-8 multi family unit properties (fits your scenario)* must be for investment, non owner occupied (if looking for a product for alternative qualifying solutions for owner occupied there are other products)* can close in a personal name or LLC* usually 80% LTV for a purchase (20% down payment) & usually 75-80% LTV for cash out refis* prepayment penalties vary and are optional, but the higher the prepayment penalty, the lower the rate / options typical range from no prepay all the way up to 5 year prepay and structures vary for how those penalties work (3 year is my most popular by far)* appraisal most likely required and paid out of pocket during transaction* can be used for long term, mid term, or short term rental properties * generally 1%+ is the desired DSCR ratio but you get better rates if the ratio is higher (usually rate breaks kick in at 1.15%+ or 1.25%+) and you can still get the loan done if ratio is lower than 1% but the rate will reflect that (DM me if you wand help learning how to calculate the ratio)* the average time to close is 21-30 days* fees vary lender to lender and product to product, but $1595 underwriting plus title fees is pretty standard* 700+ credit is preferred to get max LTV, but plenty of options if credit falls below that* a typical loan minimum is $75k (have limited options for $50k+) and typical loan maximum is $3-4m (have limited options for $4m+)* 3 months reserves usually required, having 6+ months will usually result in better loan terms, 0 reserves can still get the job done if you go with a program that allows you to use the cash flow as reserves* 30 year fixed, IO, and ARMS available

The down payment is 20% for investment, means that you have 2 properties for 250k each.

I get enough cheap out of state properties to give myself some cash flow, allowing me to afford the mortgage payments on a couple houses around here--keeping some exposure to the Seattle area's potential for appreciation.