Cons: not a lot of meat left on the bone, these properties are already fully rehabbed, so your purchase price is likely near the top of the market.

You'll have an advantage as when you're buying a single family home, you could look for ways to maximize your value by purchasing a house that has a finished basement.More often than not, my clients that have been in your shoes have ended up living in the basement while renting out the rest of house as a full home.Not saying this is what will work for you, but just my $0.02 on what to look for... give me a shout via DM or text me at the number in my signature.

Testimonials are a huge red flag to me as they are difficult to verify and could be paid actors etc.

Requiring a wire is another red flag. #1 seems relatively normal

On the other hand if they are a sponsor that is experienced in stopping a skin in the game, that's a huge red flag for me.c) how open to scrutiny are they?

We didn't expect the fact that insurance should cover short term rentals but raises a red flag for lending during the 30-60 day period after closing where they make sure you're not using the home as a rental.

A wholesaler contacted me about this house they have under contract for $205,000 that they want to close on within a week for $220,000. The house is in my hometown, I'm very familiar with the area. The house is easily...

He has not attempted to contact me at all.

HUGE red flag. 

Negotiating a security deposit amount is not a red flag for me, especially with over $10K in estimated moving expenses (professional movers) and move-in costs (1st month and security).