Because two things: first, if you can't save enough money to make a down payment on an investment property, you shouldn't even be in this game, and second you are going to need cash reserves to cover the infinity of things that can go wrong on a rental, which means you should already have some free cash flow coming in from somewhere to account for that before you even rent the place out.

Of course, with all things, the answers to all these matters will depend on the circumstances.California tends to have more laws on the books and requirements and restrictions that it can be a good idea to form a CA LLC for out of state property so that you as a CA resident are covered, and to try to have your contracts fall under the purview of CA courts.

We keep everyone in the loop all throughout the process.To stay on track, we maintain a comprehensive checklist that covers all the tasks involved in closing a deal.

A mentor of mine with 400 units told me I can use a large seller credit to cover most of the down payment on a property I'm looking at.

Plenty of rent money to cover the PITI.) 

Can try to reposition to Class B, but neighborhood may impede these efforts.Vacancy Est: Historically 10%, but 15-20% should be used to also cover tenant nonpayment, eviction costs & damages.Tenant Pool: majority will have FICO scores of 560-620 (approaching 22% probability of default), many blemishes, but should have no evictions in last 2 years.

My recommendation is to get enough income to pursue a 25% downpayment, enough reserves to cover most of capex and vacancy.

You even indemnify GPs against false claims and sign to cover legal cost.

Can try to reposition to Class B, but neighborhood may impede these efforts.Vacancy Est: Historically 10%, but 15-20% should be used to also cover tenant nonpayment, eviction costs & damages.Tenant Pool: majority will have FICO scores of 560-620 (approaching 22% probability of default), many blemishes, but should have no evictions in last 2 years.

The goal is for the rental income from the units to cover all of or most of the mortgage, multifamily house hacking, if you will.