Bryan: California is a difficult place to learn, because everything is so pricy.  

Best neighborhood and best assets are subjective and largely based on the individuals capabilities (balance sheet, skill set, time etc.)

Hi, pre foreclosure in all of its permutations, before the bank sends Notice of Default (NOD) or efter which is state even county dependant but often starts a 4 week clock till the trustee auction are the 2nd most difficult deal scenario and IMHO only experienced investors should bother, the 1st most difficult deal scenario are bidding at the court house steps on lord only knows what is being auctioned off sometimes even 2nd mortgages, you need to do so much home work to attempt to reduce your risk at the court house steps...Pre foreclosure no one talks about these issues, always about the nice sounding stuff like "motivated seller" get a good deal etc etc both are usually not the case.- 95% of folks in pre or post NOD want to stay in their house, keep their house inspite of them 100% will loose the house at the auction. 

Even if someone in these forums were to teach you a creative financing strategy that required zero out of pocket cash and the seller was willing to accept those deal terms, you still aren’t qualified to own real estate with your current balance sheet.

If I wasn't certain her story tracked, I would ask for documentation of her 401k balance and her application to withdraw money.

This is very frustrating given that I was under the impression that I could just roll the entire retirement balances over to a IRA and then have complete control to invest that money into properties. 

If they don't have time to get on the phone and speak with you to explain how they work, then they will be even more difficult to get ahold of once they already have your business.

It's difficult to see how a tenant will be after screened and signing a lease.

Balloon Payment:• At the end of 24 months, the buyer will make a balloon payment for 50% of the remaining balance of the loan.• This balloon payment will be paid through a cash-out refinance of an investment property valued at $198,000.7.

The 5% of the remaining balance late payment fee is a little much IMO.