I run the numbers with even 5 or 6% and they great but 7+ just not good Just to add... if rate alone is making or breaking your deal, then it's already a losing deal. 

As a new investor, you should be looking to put together a strong, experienced team to help you side step any landmines you are bound to run into.

My partners and I run a residential assisted living focused fund.

We also are very verse on the Property Code Laws of what legally we must do and what is just good business.So @Ian McClure to answer your question, it would depend on how the new tenant was on boarded and what kind of business the owner runs concerning his property

I never run credit so I am curious to know from current lenders that deal with credit daily. 

Greg, that's a solid advice - run your numbers based on market price, not on Section 8.

After I would refinance and roll it into the next deal, like all BRRRR's work.Lets say I find a deal and the numbers run to be exactly like the situation above.

The concept of the Housing Authority running out of money never even occurred to me!

If you have a solid tenant lined up, like say Bigger Pockets HQ (yes, I put 2 and 2 together there, I'm sure you have too :), or some other business you  or someone you know personally runs, I think it's a no-brainer.

Quote from @Garrett Brown: Hey Kyle, you are taking the proper steps by switching in the long run.