But please, my pressing question is thus, after securing a property out of state, how am i gonna get a reliable contractor for the rehabilitation and how am i gonna be rest assured that after paying the contractor, he would execute the rehab job considering the fact that i won't be there in person for checks and balances?

I am also working on a practicum at the Department of Rehabilitation doing psychological assessments.    

Great job people, like seeing community involvement as that is where you will meet other like minded folks.My community gigs began in 82 and have been active until a few years ago:Coached Little LeagueDid volunteer tax returns for seniorsSang Bass in the choirTreasurer of large men's groupVolunteered with American Red Cross, Disaster Relief, Damage assessmentsBoard of Directors of Habitat for Humanity affiliateBoard of Directors, Ozark Literacy CouncilBoard of Directors Community Housing Assistance & DevelopmentAppointed as Commissioner, Springfield Public Housing AuthorityAppointed as Chairman of Rehabilitation and Redevelopment Committee of City long range planning commissionVictims Violence Center Volunteer Executive Director of Non-Profit Housing Organization teaching homeownership skillsOzarks Greenways, volunteered at lake clean ups (thanks Bob) I'm sure I missed some I know, but those in RE should be involved in their market, you are not only helping others you are shaping the market you're active in, it pays great dividends.

I have a rental available and was contacted by a New Jersey (NJ) organization called Bridgeway Community Partners in Mental Health aka Bridgeway Rehabilitation Services.It sounds like they send out their own inspector to ensure habitability of the property and then they pay for security deposit and monthly rent until tenant gets on their feet. 

This is not working as the stock of housing they own is generally in bad condition and requires repair beyond the ability of the individual owner to fund.The Obama administration is stating two things:1) The government should not own individual properties that have been repossessed through foreclosure.2) They want to enact a program that encourages investors (as opposed to owner occupants HUD currently favors) to acquire these properties who can afford to rehabilitate them and then rent them or sell them.As an investor interested in acquiring a portfolio of rental properties, I'm curious to double-click into the details of the program and understand what exactly is being proposed.

In fact, our closings are also Construction Draw #1, and all borrower pre-paid items (architectural, survey, engineering, etc.) are drawn down at this stage and either credited to borrower equity requirements, or paid to the borrower.New Construction/Substantial Rehabilitation Insured Loan Program offers more favorable terms than traditional two-step construction and permanent financing.

I would also separate the receipts by rehabilitation and operating expenses.

When I wanted to learn another/different/better approach to rehabilitation of unloved properties as buy-n-hold investments, I networked to find out who were the reputable flippers and, from that list, the ones whose attitude to energy efficiency retrofits was closed to ours.    

Borrower further represents that the loan funds will be used solely for the purchase, refurbish, rehabilitation, remodel, service of, and to otherwise maintain such real property, and for no other purpose.

Substantially rehabilitated one through three family dwellings are exempt for five years (if they were previously vacant for 18 months) or one year (if occupied), and if the rehabilitation exceeds 50% of the dwelling’s value.