Quote from @Sufyan Ahmed: Also, should I buy a property using an entity like LLC, INC. or should I buy it in my name?

Auction buying is a risk just is..

Once you are familiar with what a good investment looks like, then you can create a rule of thumb to help you analyze property faster and only dig deep on the ones that look promising.Here's a guide that describes what good cash flow looks like and how to analyze a property.https://www.biggerpockets.com/blog/rental-property-cash-flow...

As for the initial post, I would ask a few questions to shed some guiding light.

So, once more, please clarify how many lenders we work with and how much we charge for them to buy our leads (hint hint, there is no answer here as this is not how we work).

I’m weighing two options for our housing situation and would greatly appreciate your advice, given the complexities involved.1.Renovate and Buy Another Property•Invest to renovate our current home adding a bedroom to the house given our family outgrew the house.

What you describe sounds a little like a BRRRR (Buy Rehab Rent Refinance Repeat). 

So why would we buy the cash flow at a rate of 6%?

Buying a property under general partnership with 2 other friends.

Check out The Ultimate Guide to Grading Cleveland Neighborhoods to get a firm grasp on why that is.