Essentially (broad brush strokes from a layman's understanding) what many people don't realize (and I didn't before 3ish years ago) is insurance companies have insurance against their own substantial losses; 'reinsurance'.

@Jarrod OchsenbeinYou are correct that if property has equity coverage you would get paid off in a foreclosureJust realize what is loan for, if it’s fix and flip the property may not be fully renovated which add riskIt comes down to underwriting the borrower.

Tenants realize this and will more than likely treat your place with more respect.The property management software makes it all soooo easy and it will set the foundation for you to scale with systems in place.

My advise is to start with single family or a small multi-family ground up project first but this market environment is truthfully not the time to be completing any ground up projects unless you are self performing the construction which it doesn't appear you are in a position to do.There was a recent Philadelphia  forum chain started by someone else who was contemplating ground up in a similar fashion to what you are proposing and I cautioned they would be better off buying something that was newly built and believe after conducting their own diligence realized it was too cost prohibitive at this time to build with 3rd party GC's in Philadelphia when also accounting for the interest rate environment and cost to build.

I didn't realize this community was only for people in the good 'ol boys club.  

On the flip side given how sub to has been mass marketed through the guru / trainer folks you are going to have a lot of the buyers who are NOT properly capitalized  who dont understand how to do these correctly or are just plain crooks and when things dont work out they walk or even worse realize they can just rip rents and not pay on the mortgage this was very common back in the mid 2000s  I got a few interviews with the FBI chasing down folks that did this 20 30 50 times they were criminal enterprises and they ended up in prison..

I’ve realized basically every one of these signs I’ve seen is either hand written or just not professional looking at all they say “we buy houses cash” and have a number underneath . 

When I first started my real estate journey in 2018 and started listening to BiggerPockets Real Estate podcasts, I was only familiar with Cash on Cash return.Once I actually entered the game in 2020, I quickly realized that there were many more calculations to take into consideration:ROI - Return on InvestmentROE - Return on EquityIRR - Internal Rate of ReturnEM - Equity MultipleCap Rate - Capitalization RateCoC - Cash on Cash ReturnAAR - Average Annual Return(I’m sure I'm missing some)I still struggle to juggle all of these calculations today.Developers, syndicators, flippers, etc., will all have different preferences.Which key calculations do you prioritize on when analyzing your deals?

Of course you can be passive and buy performing stuff and get nice returns but when people are having courses that show you how to make a few hundred grand a year in notes people get all excited and rush to the well only to realize it’s dry and you need to work to fill it. 

New to the forums and didn’t realize could do a direct response until after I posted.