When I lend money to flippers I insist for them to have a skin in the game.

My current thinking is that if I am able to beat the 50% rule and given if the property is not a junker and doesn't seem like there will be significant difficulties getting it rent ready, it seems like I could cash flow even while "ignoring" the 1% rule.

When it comes to purchasing discounted mortgages as a business model, what headaches or difficulties or nitty-gritty annoyances have you discovered in the note business??

They want you to have skin in the game.The bank's term sheet or commitment letter will state that they will lend you the lessor of XX% of the appraised value or purchase price.

you can tell from my picture that I do not resemble the main stream  shape or skin color . 

Second, you would effectively have no skin in the game.

I thought that was fair - he is also going to look into getting a line of credit to throw a little cash into the deal or keep it as a reserve so he has some skin in the game.  

As an off campus college rental investor, I've seen the difficulties finding larger groups interested in living together at a distance from campus.  

How difficult is it to obtain? 

It worked out well for him, because he basically got a "turn key" house that he could "test drive" for a year before actually buying without much skin in the game on his end...