The death of a principal won't kill the corp structure but you may be dealing with heirs, so consider how either party can get out and assume business management.Good luck...

Amend the way you are thinking about it, I think you mean what happens when the investor has 100% of his principal investment returned to him?

She also says that if he owes more than he's selling it for and if he doesn't have that money he will have to pay back my down money and anything paid to principal during the lease period.

That way a buyer can use that money as a contribution toward principal to make things less underwater.

Your gross income is your personal gross plus 75% rents-PITI.Take that number times 28% for a conservative, conforming coventional loan for PITI (principal, interest, taxes, insurance).28% of 7980 is 2234.

Also, when calculating estimated returns/cash flow, part of the mortgage payment is going to pay down principal, should this be considered in estimating returns as you are building up equity for yourself?

Principal reduction is a revenue event for you.

This will not remove you but you will know if you can get any principal reduction to get a little closer to market value which will open your options up.

Finally locked in a rate for the first property, 1,850 condo - 3bed/2bath @ 101k 25%down for 15 year loan. 560 Principal and Interest.

Talk to them now to extend the loan, a refi and see how much they will want to reduce the principal.