Quote from @Jay Hinrichs:Jay, it does look like one of the strategies of this 711Rescue is to restructure the loan for their clients, but at 2x DSCR!

If you can find someone to loan you money for this endeavor please share their information with us all.

Since i had capital and had access to my commercial banks for the best rates possible on vertical and horizontal loans..

Or putting 20% down in a conventional loan so you can also avoid PMI. 

Non conventional just means the loan will not be sold to Fannie/Freddie so they do not have to follow those rules.

Right now, the best offers around me are for some 1.3-4 million, that only generated around 100k per year gross, so there would be a high chance of not cash flowing, and paying money, especially with a commercial loan (these buildings have more than 4 units).I was thinking that although the rental itself does not generate money, I would be able to deduct the mortgage interest, and depreciation from my personal w2 income and would be net positive.

That doesn't seem right about having to chase your money - but would need a lot more info to provide a better opinion. also are you investing in one property and is your name secured or you giving an unsecured loan? 

I have also been doing quite a bit of research on Loan's, tax consequences etc., and am working towards being a expert in this niche.  

We financed this deal using a residential VA Loan.

His "buyers" - who could not qualify for a loan because, presumably, they could not convince the bank they made enough to cover PITI payments - inevitably defaulted, and after a few months he would evict and start all over.