Accounts in collection would be a concern so I agree with others to decline this one.Since you are using the background check to make the decision, I would recommend sending an Adverse Action letter as required per the Fair Credit Reporting Act. 

My wife is more risk adverse and wanted to use the Cash Flow from our first property to pay off the existing mortgage faster.  

I do work as an actuary so I’m very risk adverse to begin with but this will be my first rehab.

Those that actually need the help shouldn't have any issue with providing some additional documentation to demonstrate how they were adversely affected.  

In choice #2 the syndicator might be tempted to suppress the adverse findings in DD, close the deal, bank their fee and hope that the market bails them out.  

The walkthrough should provide you with further insight into the risk you are taking with this tenant in place.You may end up making the decision to consider eviction if they are taking other adverse actions to your property.

You might want to ask that attorney about adverse possession laws in your state as well. 

@David Palmer it depends on many factors but I would say the 3 significant variables are:Your risk tolerance: how comfortable you are with leverage, I tend to be risk adverse so I always have ample.  

If your rental is large, it could have an adverse effect on the traffic as well.   

Hi Dennis,I’ll start by answering your latter question first.In my opinion, it may be best to pay an attorney or title company (depending on your state laws) in order to get a report on any adverse actions that the property may have incurred.