While the “debt to equity” practice may not meet MY PERSONAL definition of “fair”, in and of itself it is not illegal, unethical, or fraudulent.Truth is if the posters warning about the subject have accurately portrayed the specific situation, there is cause for concern.  

Lease Options: Structure a lease option for the property you're flipping, allowing you to control the property while securing financing through the lease payments.By combining these strategies, you can create a unique financing plan tailored to your specific project and financial situation.

You lose control of the property.

These are areas GPs can control and I guess choosing not to. 

My real estate agent doesn’t seem familiar with that and didn’t tell me about the 3 people outside of family circle max requirement in single family zoning.I also need advice for renting finished basement legally and make more bedrooms, experiences and tips are more than welcome as he didn’t seem knowledgeable.Shall I change of real estate agent and find someone more used to this type of practice ?

He practiced that well and his son is now one of the largest developers in the country, if not the world.The nice thing for investors is that there should be a 2-3 or maybe 4 year gap in major apartment developments coming online. 

If the answer to both added questions would be "yes", then you have a potential goldmine here.Combining the seller's concerns, and the reality of a big down payment being a negative to the seller (see Q: 1), you should be able to set the terms, with a lower DP, and controlled interest rate, to have this property CF and,...be able to sell the package to another REI down the road,...as long as you buy this using an LLC (a new one). 

Also, asking for exorbitant fees up front to provide a term sheet is not legitimate or ethical practice.  

One of the primary issues is the impact of rent control policies.

You may not occupy your apartment without electric service except during brief interruptions beyond your control.