But there are also some real challenges, like dealing with lower tenant quality on average, the extra red tape, annual inspections, and the longer time it takes to get tenants placed compared to the open market.

For someone that's not as conservative, or a different view on the cycle, they might have a different opinion than me on all of this.2) Sponsor quality check: (takes about 45 minutes per deal)I believe that a great sponsor can take an average looking deal and make it great, and that in mediocre sponsor can take a fantastic looking deal and make it bad (especially if there is a severe recession).

I think their general stance is going to be to go with whichever comparable property has the greatest degree of similarity in terms of (probably, in this order): location, age built, quality of construction/current condition, and square footage.

Much of this is loan underwriting and it can identify a quality note.Today, you should turn over any note you buy to a mortgage servicer, for about $300 +/- a year you'll avoid tons of regulatory issues, tax filings, notices required and collections with a performing note.

Under bidding, poor quality, not following timelines - those will all kill your project.

The E-Myth by Michael Gerber- Start and operate your business with the consumer in mind... not you... not your product or service.

So will see how that all shakes out for PDX. really the affordable is in Townhouse production by the large production builders thats about as good as it gets..

Of course, many investors bend/break this rule, but that's another risk.2) If your bid wins the foreclosure auction, you then have to deal with getting rid of any occupants - who may steal/damage everything they can in retaliation:(3) You MUST have a great crew on the ground that can minimize surprises - not easy to do on your first deal.Regardless if you buy a foreclosure or other property, read our copy & paste advice below:-----------------------------------------------------------------------------------------------Recommend you first figure out the property Class you want to invest in, THEN figure out the corresponding location to invest in.Property Class will typically dictate the Class of tenant you get, which greatly IMPACTS rental income stability and property maintenance/damage by tenants.If you apply Class A assumptions to a Class B or C purchase, your expectations won’t be met and it may be a financial disaster.If you buy/renovate a property in Class D area to Class A standards, what quality of tenant will you get?

Other factors such as the quality of the tenant, and location will also determine the value you can get.

The allowed rent amount should be pegged to market rent, so it would only be way off if your unit is a way different quality or neighborhood compared to average.