Your deal looks solid and falls within the typical range for Cleveland.

Structuring private lending as passive income can be tricky since the IRS typically classifies interest income as portfolio income rather than passive.

And, these were typically also underwritten with the idea that a downturn was inevitable.

Hello @Kyle Luman,In the first few years, tax deductions like depreciation typically offset cash flow, depending on the rate of rent growth.I also want to comment on your statement: “Buy in appreciating areas.

If you work with the same lender that may speed up the process but expect a typical 30+ day closing.

Here is a list of what adding ADUs, especially in single family zoned areas,  in my CA market is typically a poor RE investment:1) The value added by the ADU addition is often significantly less than the cost of adding the ADU.

------------------------------------------------------------------------------------------------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?

@Lucas Helliker I am a multifamily broker who only sells multifamily in the KC metro - typically 5-50 units but go as low as 2 and up to about 72 units.

When it corrects there are typically just a greater amount of opportunity especially when there was a large run up to the correction by those who did not follow traditional risk mitigation measures when investing.

I have heard a little about seller financing and it seemed interesting but just unsure how to find deals, start, or how the negotiation typically goes.