That's my concern @Jay Hinrichs and why to this point I've avoided it.The ONE thing that makes me consider it is talking to a few older developers is guys who did 'new construction' using surplus/cheap material getting their material expenses down to near nothing (4-8 plexes) and getting a decent yield that way compared to rehabbing existing structures.

Final comment - banks merge and dispose of surplus real estate all the time.  

You cannot use any surplus rental income over the PITI added to your qualifying income, but the amount of rental income up to the PITI can be used to wash it to $0.The paid off house you can also use the rental income on the most recent tax return, as long as you have a 2 year history with other properties.

I actually keep surplus supplies locked in the basement for each rental.

If the amount the tenants have paid into the fund exceeds the cost of utilities we offer the tenants with a choice to:a) leave the surplus in the budget in anticipation of higher utility bills in the coming months (i.e. winter); b) apply the surplus to the next months rent; orc) refund the surplus (only an option at the end of the lease).If the cost of utilities exceed the contributions by the tenants (it's only happened 3-times), we invoice the tenants and the under-run is due at the start of the next month.The Utilities Budget gives the tenants the convenience of a single payee, but does not leave the Landlord holding the bag for careless resource usage.

I have 3 agents working on a builders risk policy, but so far the one I received a quote from is with Lloyd's of London via a surplus lines reinsuror and comes out to about $400 a month for 6 months of which 50% is fully earned.

Use Monthly surplus to accelerate bad debt pay down.3.

Instead of using surplus cash flow to pay down the loan the surplus is reinvested at 10%.

The company offering an IUL is absolutely spending the surplus that what would have been the dividend, had it been a whole life product, on hedging activities.

I am starting to think they may just want to get a hold of interest in the property to have a claim of the surplus..