@John LubinI am the first one to tell you that not all PM's are created equal and that there are a lot of really bad ones out there.

What's something that happened which was unexpected or you didn't anticipate (good or bad)?

This should be treated as criminal behavior

Nobody want to buy this property because was in really bad shape.

They have a TV channel dedicated to bad tenants and I believe they are almost always Section 8 tenants.2.

So we are not in agreement.I sent this to my tax accountant https://www.investopedia.com/terms/p/passiveincome.asp.She sent the IRS link to me https://www.irs.gov/pub/irs-pdf/p925.pdfI wonder how your tax accountant treat your private lending interest?

Best to structure and treat as if a property management company from the start.Think like an institutional lender/servicer.

The good applicant eventually gets tired of carrying the water for the other, leaves, and you are stuck with a bad tenant. 

Being out of state, you will learn all but bad things of the process and make you think if you made the right decision.You have to start low and close, meaning trying to house Jack locally is the best.An FHA loan requires you to live in the property.

It relied on everything going right and nothing bad ever happening.