How legit is their practice if you have an idea about it?

The Justice Department’s acting assistant attorney general, Doha Mekki, put it bluntly: this case is about ending the practice of “putting profits over people.”

Quote from @Virginia VanOeveren: To start as a private money lender, educate yourself on real estate investing and lending practices, define clear loan criteria, and conduct thorough due diligence on borrowers and properties.

And in the modern era, real estate and stocks returned practically the same amount (within 1%).

Quote from @Frank Barletta: It is more cost-effective and practical to install a large-size TV and get the Nintendo, Super Nintendo, and Sega Mini consoles.It comes with games preloaded, legal, and each to swap in case something breaks. 

In my experience, late payers often become non payers; so, I stick with the practice above.

The cons as i see it include loosing the 2 of 5 year cap gain exception, typically not an ideal rental because the emphasis at purchase was buying a good home for your family and not a rental with optimal return (my ex-home consistently has the lowest cash flow for equity in my RE portfolio), not disconnected enough from the property causes addition angst on damage and may result in over improvement.  

From what I see my options consist of:1.

If there is not enough STRs in the market you are in then you have to adjust business practices.

There is a formula that you must follow if you want to perform, having a realtor who knows the market inside and out and practices what they preach is an absolute necessity.