In a worst case scenario like the house burns down or a tenant sues you and you're not insured properly, that's a big risk. 

Hi Brett, you should run a proper property analysis.

Your emphasis on proper property management is a key takeaway, and I’m committed to educating myself in areas like tenant screening, lease enforcement, and proactive problem-solving.

Crappy products made not to last.

Just ideas, talk to your CPA to make sure you are doing it properly. 

Small shop brokers that have access to multiple programs so that they aren't beholden to one or just a few loan programs will typically get the most competitive product for the borrower. 

One of the biggest challenges for everyone involved is being on the same page about the actual time required for maintenance.DIY landlords rarely properly track their time when it comes to property management in general - tracking their true time invested in maintenance is where they perform the worst.Investors that hire PMCs are rarely any better at understanding the true amount of time maintenance takes.

Book recommendation #1: Hands Off Investor by @Brian Burke https://store.biggerpockets.com/products/the-hands-off-inves...Book recommendation #2: Lend to Live https://store.biggerpockets.com/products/lend-to-livePodcast Recommendation: PassivePockets podcast is focused on passive investing in syndications - https://passivepockets.com/podcast/Passive investing summit: PassivePockets Summit May 2-3rd in Columbus https://get.biggerpockets.com/passivepocketsevent/I make these recommendations specifically since you mentioned passive real estate investing, and syndications or hard money lending are really the two most passive ways to invest in real estate. 

To avoid issues, hold the property in the trust for a year, ensure the LLC is properly structured, and consult a CPA or 1031 exchange expert to confirm compliance with state and federal tax laws.This post does not create a CPA-Client relationship.

That would have been known up front if that was the original loan product being used.