With future income you pay off that loan as well.

My biggest focus right now is passive income.

There are BLOC's Business Lines of Credit which will allow collateralization of residential income properties.

Don’t forget to pay your state of OH income tax, even on the formerly tax free money you are transferring out of NV in to a state with income tax. :-). 

In this case even if the project went south and you broke even or even lost money, the equity (debt) you used would still be covered by the income you are earning on the rental property. 

The property manager should be involved before you buy any property to give input on due diligence, how to increase income and reduce expenses, and to make repairs or improvements to maximize occupancy.Excellent property management is critical to your success before, during, and when planning to sell or refinance.To your success!

But, when you combine all the potential lost income and damages, I will definitely be the losing party since there's a cap on small claims.

. ==== Projected Income ====**Off Season**-$4,000/Month Rent Period: September - May (7 Months) Projected Income: $28,000**Summer 1**-$8,000/Week Rent Period: June (4 Weeks)Projected Income: $32,000**Summer 2**-$8,500/WeekRent Period: July-September (12 Weeks) Projected Income: $102,000**Optional** (Basement Apartment)-$2,000/Month -Rent Period: Year Round Projected Income: $24,000TOTAL PROJECTED INCOME: $186,000 ==== Operating Cost ====-Mortgage: $84,000 ($7,000/Month) -Utilities: $36,200Gas $6,000 ($500/Month) Electricity $6,000 ($500/Month) Internet $2,400 ($200/Month) Garbage $5,000 (Estimate) Pool $4,000 ($250/Week)Landscaping: $4,000 -Mowing: $2,400 ($150/Week)  -Clean Ups: $1,600 (Spring & Fall)-Weekly Turnovers: $8,800 ($550/Week)==== Legal Cost ====Summer Rental Fee: $20,100 (15% of $134K)Sandwich Rental Tax: $6,855 (15% of $45,700) NET PROFFIT: $38,845.00

Damon That's the rub with low income tenants.

Virtually everyone lives somewhere especially true for those that pay taxes (in CA property and income tax).