I told him that he never told me that that was a bedroom and had implied all other tenants were upstairs.

Another issue, probably never spoken of by brokers, is the type of loan originated is made with specific and implied warranties by the originator, as notes pass through the hands of investors, those warranties don't just go away, the new note holder inherits them.

If you buy a new fridge there are implied and explicit warranties.  

The answer to your literal question is yes, there are plenty of stupid investors out there; the answer to your implied question is no, your business model is not a sound one.

Lol I hadn't meant to imply that others wouldn't have a "due on sale" in their contracts.

@Julius Dixon Well, equity can imply several things. 

You imply that my comment was down playing the entire DST industry. 

To be clear, I'm not implying its a neglible factor.

Using 5% on a cash neutral (after all expenses: PITI, vacancy, maintenance, cap expense, and misc expense) financed buy n hold at 75% LTV (easy conventional financing, VA or FHA would provide much better LTV if owner occupied) would imply a 20% projected ROI.  

[It says "assume that taxpayer does not elect the de minimis", which implies that taxpayer can elect for all the examples listed ][One of the examples is:] "Example (10).