If that is the benchmark of an investors diligence, educating them on compliance is a lost cause.

I don’t know if the cause was fraud, incompetence, or a combination, but it is really sad.I was able to work directly with my borrower and my loan is still performing (amortized it rather than keeping the balloon). 

Probably that may be causing confusion.

This amount provides a reasonable safeguard against potential claims if something goes wrong, like an accident or damage to the property caused by the tenant. 

Do you think this issue is specific to banking services or what do you think is the root cause?

Most on the other hand are not responsible individuals, are not educated, do not work  which means they are going to be spending most of their time home causing additional wear and tear.

However, cats can cause far more damage than dogs.

Need to be an accredited investor as well.A bit surprised there isn’t more on BP about these guys, which I’d say does cause me a bit of pause.

The sellers you will be talking to will typically be in a bad situation which is causing them to have to sell their house, and at a big discount.

I wouldn't worry about what will happen, cause something will at some point.