I was told that the RE markets that had safeguards to ensure that the people who are applying for loans are qualified are not really being affected by the foreclosure crisis.

We were going to both invest $50k and split 50/50 on the profits on that triplex, which would have brought us both about $300-$400 / mo profit after costs.I want to trust him, but I also want to safeguard against anything going wrong.My goals are to simply buy property, both Multi-Family Units and SFR's, and create a passive income stream to help me with my goals of going back to school and creating something bigger with my life.Any advice is greatly appreciated!

If rates are higher in the future and you have a balloon you could find yourself in trouble, so with the ability of keeping the funds longer you have a safe-guard in place.

Don't get overly concerned about public liability but you do need to be aware, keep properties in good and safe condition, know the rules and conduct your business with attention to details and you should be fine and carry insurance....And I believe Texas has an LLC that limits liability to a subject property safeguarding other business assets, which is unique, I suggest you simply form your business in Texas.

And I would guess that a $1000 a month tenant can't afford to replace their belongings after a loss any better than a $325 a month tenant so renters insurance is a safeguard for either of them...so it might save the tenant in the long run if the landlord mandates a renters policy.

Initially, I thought the deposit amount (22%) was a safeguard.

In some cases, liability can be restricted to the actual property, which enables you to safeguard other assets.

However I have had 3 frightening incidents in Latin countries, especially Mexico, that make me really distrustful of their ability (or desire) to safeguard people.

I'm turning over a house now with a fireplace with all of the above safeguards and they left me the cinders/logs/debris to haul out and clean.

Of course that will not get you out of compliance altogether as you still need to have a Compliance Management System for Red Flag, Safeguard, the Disposal Act, Patriot Act, OFAC, and Anti-Money Laundering and now Advertising.