Recommend 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?

You mentioned you haven't purchased an investment property before or been involved with seller financing transactions.

I've had friends buy new homes and have more problems due to poor construction than I've had in 'older' homes.

I think if you just attend any group, you'll find investors that purchase remote and local and you'll be able to learn.

I'm an investor-friendly agent in Cincinnati.

@Wade Wisner -  Most of the notes that we purchase we keep in our portfolio and borrow against them with private capital.

Keep grinding it out my friend. 

I'm going to do new post referencing insurance - this has been a big topic amongst my California friends. 

The substitute of collateral was more of a scenario where you sold for $155K, and instead of paying off the $88K loan in your scenario, those funds stayed at the title company and were used on a cash purchase happening nearby in date. 

See, the majority of profit in real estate is NOT made by below market purchases.