I'm located north of Houston, Owned a Real Estate Mortgage company years ago.....(retired).  Starting all over from scratch... my gray hair is turning back black....LOL.   I'm focusing on buying and selling mortgage n...

I did do a precursory investigation into what requirements are and it looks like there might be some zoning restrictions, as well as permits required.

It sounds like you are investigating the DSCR route due to lack of investment funds. 

My humble advice to anyone attempting to do creative finance is:Creative finance is for experienced investors who have access to capital if anything goes wrong.Learn the lawsDon't use a contract "off the internet", laws vary by state and are also regulated on a federal levelLearn the financing techniques correctlyDon’t skip parts of the processDon’t ever do a “kitchen table” closingUse the proper deedAn attorney can help you with the legal work, but the rest you are on your ownYour guru will not bail you out“Investing” in someone else’s deal by providing a small 2nd loan so the “investor” can pay for “cash to the seller” and for “closing costs” so he can do the deal is a very bad planKnow what problems can ariseLearn the responses and solutions to problems before they are neededKnow everything there is to know about Title and what that meansKnow who a "protected class" individual isLearn the "back doors"Learn human natureUnderstand timelinesUnderstand regulation enforcement (some of these "mistakes" have a 10 year statue of limitations ( they can charge you 10 years AFTER you do the transaction) and carry hefty fines and possible imprisonmentThe court doesn't accept "I didn't know" for an answer"Know that the source of the lead plays a serious role in some states and federallyKnow how much of a "profit" pushes the boundaries to invite an investigationYou can be sued by the seller if you don’t do things correctlyYou are automatically at fault if an investigator or attorney or regulator gets involved.

Cops all the time do everything they can to not investigate crimes.

The 50% rule - in my opinion- is used solely as a quick back of napkin calculation to determine if it is worthwhile to do more investigating of a property. 

The fresh perspective from someone outside of my network is crucial, that way my expectations can be closer to reality if I decide to reach out to new contacts for this opportunity. 

Travel costs to look at other properties.If you travel but have not identified the property that you want to buy yet, the cost is considered an investigating cost.

Their lease is 6 month term with a same rate month to month however, their insurance states the rebuild of their home and fire investigation efforts are going to take 12-18 months. 

Yeah- I have family in New Orleans so that's kindof why I was leaning towards it/investigating.