It may not be so easy to just replace the company you have.

This doesn't replace the need for a MSA that will capture additional clauses needed on a Contractor-SubContractor relationship, this is just a project specific form you would use in addition to the MSA (prepared by your Attorney):This template is for informational purposes only and does not constitute legal advice.

This is not a great return, but not terrible.As others noted, there are other risks, like having the property insured at full replacement or purchase price, or if the option is 100% seller financing with no money down or very little, versus 20% traditional down payment, this can start to move it into a better investment.

It costs the same amount to replace a roof or furnace whether the house is worth $300k or $30k (assuming a similar size).

Your reinvestment targets for a 1031 exchange would have you purchasing $700K of replacement real estate using all $500K of equity. 

You said "100% of our funds were investors" then "my capital came from bank Lines of credit NO investors", so wondered exactly how much of the 100% was replaced. 

I also renovated hallway and replaced all staircases with a new oak staircase.  

The modest cash flow could be reinvested, eventually allowing me to build a portfolio of income-generating properties.I recognize your point about needing $2.5M–$3M in cash to consistently replace a six-figure income.

I’d like more information on the DCSR lenders if anyone has specific recommendations.Also, if anyone needs advice or repairs/ replacement on plumbing feel free to send me a message! 

This term replaced "subprime" and looks a lot different than subprime loans of the past.