They should have started the pay or quit and eviction process on November 2nd when rent was not received on time.Your friend needs to take the time to sit down and learn the regulations governing his business.

We are in the process of determining all the forms that need to be filed at the CA and Federal level in order to "hire" herself as the sole employee of the company. 

My main guy served 15 years in Federal prison for bank robbery.

This is not a hobby it is a business governed by state law and legal contracts.

Meaning you can maximize your one time chance of buying a property with 96.5% leverage via a government subsidized loan - Considering the two above over the long term if you buy a multifamily you will have: 1) Created more equity via loan paydown and appreciation2) More cash flow and stabilityIn my opinion you want to go as big as possible when doing FHA.

There is an interesting discussion on "Deposit to Hold in Massachusetts" on the MA Law Forum:https://www.malawforum.com/content/can-i-recover-d...In a nutshell, there does not seem to be a specific MA law governing "Deposits to Hold."

Federal laws are the same for every state.

While it may be legal under state law, it is not under federal law, and the federal government can seize your property under civil forfeiture laws.  

Mortgage guidelines like seasoning periods and how much cash you can take out are not typically governed by state laws, although Texas has some rules on cash out refinances. 

You are responsible for knowing and understanding the regulations that govern your business.