This has allowed us to get rid of PMI and utilize a HELOC for any future investment purchases in the future.My best advice for you would be to find a local real estate agent who is familiar with what you're trying to accomplish, a lender who can offer renovation financing (and navigate it smoothly, as sometimes they can be more complex), and a contractor who will be able to take on this type of project with the bank.Best of luck!

i am wanting this income to be taxed passively, so i can avoid self employment tax. when cash flow starts coming in is when i will transition into full time real estate investing. i.e. flipping, buying raw land and developing, etc. doing most of the work myself having been in the construction trade for the last 20 years. would that put me as a real estate professional?

Because a house purchase is a significant investment in one's life, it is worth your while in having a title attorney to ensure clear title and smooth closing, along with a good inspector to assess the investment property's condition, a good realtor that will protect you with the contract, and, of course, a good mortgage broker if you need financing for your deal.   

I'm currently employed as a full-time engineer but eventually I'd like to transition into a full-time real estate investor.

I'm a 23 year old working with my dad and hopefully turning this into a full time job (in engineering now but would love to transition to real estate full time). 

Sometimes the renovations don't go as smoothly as I hope they will, and I go over budget.

And if the properties have been put into an estate planning vehicle of sorts and transitioned from active to passive then it doesn't matter whether your heirs are astute real estate investors or not. 

I was thinking that these two strategies would be a great way to start building a lump sum of cash so that I can eventually transition into small multifamily properties as buy&holds, and then eventually go towards larger commercial properties. 

I negotiate an equity split after i reinstate the loan eliminating the foreclosure, help them transition with a portion of their profits up front, and pay them either cash upfront to walk or a percentage of the profit after I rehab the property.

I know I want to have a smooth process and prepared as much as possible.