If you are thinking out of state, it really depends.

And this does not include the real world issues, namely are you even allowed to convert this property to a four-unit and taking a single family to 4 unit is very likely going to cost more than $110k (but this depends on the actual layout and work scope).

If they are able to remove the term it will be dependent on the loan underwriting requirements, not because they want to keep you as a banking customer.

If you keep the footprint of the home the same, you can avoid timely and costly site planning applications in most jurisdictions.

Maybe he does file a nuisance mechanics lien (whether he can and precise procedures) will be dependent on local law.

As for cash or not I think it depends on rates, your level of risk tolerance, and what the opportunity costs is for that money. 

You'll most likely find your staffing costs to be in the neighborhood of $1,200 to $1,900 per unit per year, depending on property size, class, and market. 

@Mary Lopez It definitely depends on your scenario and the details.

.- Our current preferred return is 12% a year, for a 3 year term (keep in mind these funds along with the notes that they purchase exist within a marketplace so returns fluctuate depending on the offering). - ACH payments are received by investors on the 1st of every month, so participation in our fund is a purely passive investment vehicle that's open to accredited investors only (and like Patrick said above, accredited or not, anyone can purchase a note).As an added bonus, investors in our fund can redeem shares to purchase notes upon availability. 

It really depends what your goals with REI are.