When I receive a referral fee, the check would be made out to his brokerage, and he would cut me a check. 

@Jamie HenkinAbsolute yes on the inspection - no matter how good you know the turnkey company, how many properties you bought from them in the past and how much you trust them, I would ALWAYS order a professional inspection.Even more so, I would not go with the property inspector recommended by the turnkey company to avoid any potential conflict of interest.The turnkey company may have missed problems during the rehab, they may have cut corners on other things and just ignored more things.

That seems to be cutting into a big part of your budget.The rest of your numbers look very similar to what I'm using when I look to find my first deal

... if you're only collecting PITI then you're in the negative, Who cuts the grass?

HVAC service call for no heat/air or plumber to fix leak or regular grass cutting) and it also assumes there are no capital expenses ever (ex. need to replace water heater or furnace).Looks like there's plenty of a cushion to account for those things, but 35% is if everything runs perfectly forever which isn't going to happen!

So I would look into the types of notes they are buying and understand that a fund targeting a high yield may very well be taking high risk which adds pressure and can cut performance.  

I cut coupons. 

Look hard to find good deals in your market and if you do not cut a any corners you will be fine.There is a few things you need to do before you get started with investing.  

They don't qualify for much of any government assistance because they are just above most limits where these benefits are cut off. 

@Scott Taylor, cut losses and move on.