Usually, PM take 10% of the late fee in normal circumstance. 

The equity position/rental income is beyond normal. 

This sounds more above board.I've actually started seeing assumable mortgages being marketed with normal listings recently.

However, it’s a gamble.

Outside of that, you're left working with normal buyer/seller relations. 

The funding situation seems somewhat odd to me, but I don't know how it works normally either.

I normally tell people to really start considering a PM between 5 - 10 properties, if not sooner.

To obtain an “outsize” return on originating notes the note holder needs to assume a larger than normal risk, or find a “niche” not currently being serviced, the note BUYER needs to negotiate a purchase at a larger than market discount.  

This is both a plus for WL (the investment returns are normally a lot less risky) and a minus (you need to pay fees so this whole well you will make the spread plus a hefty return is not even close to certain). 

Since you can't count the income toward a loan, I think their value will be on par with normal sq footage. 3.