I don’t think it would be a gamble per say.

If that is, say, 40% for his combined state and federal rate, he will end up earning a whopping 3.5% x (1-0.4) = 2.1%.Are you seriously asking someone to gamble his home and accept 100% of the risk, for a 2.1% return on a loan to someone who has no real estate experience?

It's like gambling your paid off house away on a penny stock and losing it all.

. :-)If you're refinancing to get some money out, then the bank and its chosen appraiser would be the beerholder and you're really at their mercy as to what valuation you'll get (I'm sure it partly depends on how much beer they have consumed).

When their lease runs out you can gamble with someone else I guess.

A better comparison would be to say you've downgraded your cable package and Comcast has generously chosen keep charging you the full package "just in case" you decide to upgrade again later.

Based on some quick Google searches sounds like 5 should be sufficient for the square footage of the house but at the end of the day it's just a gamble because it can be in one sheet but not the other 4 on the wall. 

If we had chosen to rent from the beginning we would have been able to use the money not spent on making the property sell-ready towards renovations/expenses on our next BRRRR Property, but we were to afraid of getting into more debt after such a serious loss.

If we had chosen to rent from the beginning we would have been able to use the money not spent on making the property sell-ready towards renovations/expenses on our next BRRRR property.

But if there are life-safety issues, i.e. heat not working in the winter, and they have notified landlord, and landlord has had adequate time to make repairs but chosen not to, the tenant can pay their rent into escrow at the courthouse.