Firstly, it often generates higher rental income compared to long-term leases, particularly in desirable locations or during peak seasons.

My passive income would be $262 total ($131 per unit).

For active investments I advocate considering how you can diversify WITHOUT ceding your competitive advantage nor the superior profitability of the niche your in.As an example my business is running an investment fund and syndication high interest commercial mortgage loans secured by income producing real estate. 

His credit score is fine but his income is showing too low to get the loan, so I though maybe I could use my HELOC to make the purchase and do a Lease to Own.

If you provide specific information such as the address, property purchase price and value,  credit, property rental income, taxes, insurance, experience, and Fico you should be able to get a term sheet detailing all the closing costs. 

@Zach Howard there is no agreed upon Classification in the 1-4 unit market.We've done our best to logically create a system for our market, mostly based upon relative sale prices, but also using crime rates, rents, occupant income and a few other variables. 

What I would tell you is that as we built our portfolio we continued working our full time corporate (cubicle) jobs until we had 20 units (self-managing them along the way).

@Sakib KhanRecommend you first figure out the property Class you want to invest in, THEN figure out the corresponding location to invest in.Property Class will typically dictate the Class of tenant you get, which greatly IMPACTS rental income stability and property maintenance/damage by tenants.If you apply Class A assumptions to a Class B or C purchase, your expectations won’t be met and it may be a financial disaster.If you buy/renovate a property in Class D area to Class A standards, what quality of tenant will you get?

I guess I learned about Key Check, I was not super impressed, but it worked for the basics - it did not deliver income info, which I usually want to see. 

Income: Verified monthly income must be at least three times the rent (minimum $4,200 combined).