I will guess that by the time you get building permits and complete your improvements your cost will b no less than $250,000 and you lost one year of rental income and you will have to pay for utilities for a whole year and maybe run into many huge unexpected expenses.If you really want honest opinions then post all the realistic numbers for your plan.

The structure you are looking at works fine so long as the asset generates sufficient cash to cover expenses; however, as all RE investors know, the unexpected furnace malfunction or roof failure requires injection of outside capital. 

Following well drafted contracts and insurance for the unexpected provide the first line of protection.

I take it there were unexpected/unplanned repairs needed on the property.   

The unexpected bonus was my personal credit got a boost and I no longer had any long term debt personally.

@Natasha Berness sounds like it is second home, and you are leaving back to Northern California which if it's something that needs to happen that was unexpected you can contact your loan holder and see about talking with them to convert it.

All your cash flow will be eaten up by PMI and you won't have adequate capital for unexpected expenses.

I’ve got a rough idea, but I bet there are a lot of little unexpected costs I am not anticipating.

Expect the unexpected(especially at that price range), keep reserves.

Unless something unexpected came up and you want to negotiate, I wouldn't show her the report.