I am looking for any recommendations on how to properly scale this idea over the first few years conservatively and not wanting to over use leverage and debt by starting small in duplex and being open to triple/quadplex in the future if the right opportunity presents itself.

I calculate the returns on the entire investment, since your debt applies to the entire investment.

I have 880 credit score, decent savings, and no other debt except for 300K mortgage on my primary residence (worth $1.5 million).

Her mother is willing to (co-sign) and has excellent credit and debt to income ratio that will more than allow but I’m not sure the best way to structure this for the house to still be in our name?  

The denominator in the calculation is your capital/equity and with no debt the return on your existing equity is low.

Do they have any debtJust because you are a note fund does not mean you do not have debt.

However, deeds in lieu of foreclosure can be subject to judicial attack by their grantors and their grantors' creditors.Grounds for attacks on deeds in lieu of foreclosure include the following:• That the deed was an equitable mortgage - that the parties intended the deed to be given as security for a debt and that the deed was not an absolute conveyance.• That the deed is either a preferential or fraudulent transaction within the purview of the provisions of the federal Bankruptcy Act or any other related state law.• That the deed is a device to clog a mortgagor's right of redemption.• Unfairness of the consideration.• Coercion, fraud, oppression, duress, and undue influence.• That the deed is not subsequent to the execution of the mortgage but contemporaneous with it.• That the grantor/mortgagor was insolvent at the time of the execution of the deed.An estoppel affidavit (executed and acknowledged by the grantor/mortgagor, attesting to the fairness of the transaction, the consideration exchanged, the value of the property, and other factors showing an intention to make a genuine transfer) or a recital (inserted directly in the deed) are supporting documents used to forestall challenges to these transactions.State law and local title standards must be consulted in regard to the consideration and treatment of deeds in lieu of foreclosure.What a GREAT post!   

Just a follow up question, were you utilizing debt to invest, I have always been taught since a young age to try and not utilize debt (I come from a family of stock market investors, traditional business owners) where debt is not utilized as frequently which I obviously understand debt can be a very powerful tool and utilized in a great way its just something I want to avoid with my investments to an extent any suggestions for investing without debt or as little as possible. 

Selling gets a tax free gain and allows you to be more liquid; keeping it allows you to have once in a lifetime cheap debt and have that leverage on an appreciating asset. 

So for example I'm very conservative and don't want any debt on them because I feel this hardens them in case of a severe recession.