And even in my hypothetical pullback, most people will be fine, a lot of prudent investors will have the reserves to pull them through a 3-5 hiccup and cover those marginal losses.  

Your interest rate at 4% is a bit low (I just got an OO at 4.125, investor deals are 4.5+ish) If you run vacany and repairs to 10%, an increase the rate, you are looking at about $600 profit,  or $300 for your investor, or 3.6% which won't fly.Overall, the numbers look marginal, and if you take a unit, you will be paying for that unit, probably around 1500-1700 to make it break even.As an appreciation play, maybe, but you don't specify where the property is, so it's hard to judge.Not saying no, just it looks tough to put together.Just my $0.02Good luck,Jim

I told her that I didn't like the margin with the ARV at around 105kSo she informed me today that the seller is willing to carry the note for 71k with 20k down.

If you have a lot of margin then maybe you go ahead and not worry about the security deposit.

Although, you're in Florida so you don't pay the hefty marginal state income tax rate that I do here in California.  

It is just a different way of building retirement savings.If you were to cash out the plan, you will do two things that are negative right off the bat; significantly reduce the amount of capital you have to invest with through state and federal taxes as well as a 10% penalty if you are under 59 1/2 years old, and likely significantly increase your marginal tax rate on all of your income in the year in which you distribute a lump sum from your plan to yourself.

I pay about 46% on every additional marginal dollar that I make thanks to California's glorious income tax.  

Good afternoon Bigger Pockets;A friend has come to me with some trouble regarding her house purchase under an FHA Loan, and I am new to these loans, so I thought I would throw it out there to see if anyone else has had a similar experience or can help.For the sake of this question lets call my friend (Kat) and the seller/elderly lady (Marg)She (Kat) is purchasing a home off an elderly woman (Marg) in Southern Florida.

In fact, many invest in a group of stocks tracked and known as the "Dividend Aristocrats", which are companies that have raised their dividend every single year for at least 25 years straight ... on top of that they track the "payout ratio" which computes the percentage of earnings that are paid out as dividends, to ensure that is stable, has some margin, and the company for example is not having to take on extra debt just to cover its dividend to investors.

I can help you locate properties that fit your criteria (if your profit margins are realistic) but with your budget it's going to take some work.