Second, be sure your home's value is sufficient to pay off both the first and second mortgages (which you eluded to in your original post).

I'm sure there are some who can find deals in this market, but i have yet to find any homes close to being able to cash flow sufficiently in the last 3 years after literally going through hundreds or maybe thousands of mls, zillow or other online house listings. 

It also sounds like your goals (multifamily) don't align with holding on to that property.Also, you don't need 32 units for professional property management - 1 unit is sufficient.

I can't imagine having to qualify for each subsequent future property with strictly my personal income, so what forms of information and data have been proven to be sufficient in the eyes of the lenders you guys have worked with? 

I hope you're paying attention.The first thing I looked for was an area that was sufficiently complicated to make it worth my while.

My wife and I have made preliminary plans in 8 months (8 months because we will have a sufficient "nest egg" saved up) to make the jump from a W-2 income to 1099.

@Alexia Hogan, do you really want a second job, that only pays "commission" if and when you put sufficient time and resources (including money) into it? 

It is incredibly easy to get started investing in real estate - when you have a w-2 income ....You can build sufficient investment income to quit your 9-5 job within about 5years - if you have the w-2 income to acquire the investments with financing...Unless you are cashing out a 401k to buy real estate (which I highly recommend) go back to your oil and gas job and use that income to buy your investments.Good luck and happy investing,Jeff

I am hoping that I can scale up sufficiently where a bank or a lender (private or commercial) is willing to look at us for financing and hopefully refinancing the whole portfolio or give us financing where we can start purchasing in with methods so we have more options on the table given that seller finance deals are hard to come by some times.  

Once your net worth grows it might be worth considering in the future, but for now in my opinion liability insurance + umbrella policy should be sufficient.