If so, they can sell within 2 years and not pay capital gains taxes on the sell of the home.They could take that money and buy multiple rental homes in other areas if they wanted, or use the money to downsize in to a different home while still having money left over.

Is the line of credit different from refinancing the home that is free and clear? 

Finding deals is understanding how to analyze them, those could come from different sources.

My take is a little different than most of the posters.  

Different banks/lenders are going to have marginally different numbers, but as long as you're not getting an exorbitant interest rate, it's going to be more-or-less negligible.

Plus getting the utilities to the site, is different than hooking up the utilities.You should also provide a picture of a similar building to show construction type and finish quality. 

A duplex is the biggest you can build with out getting into a different building code. 

I recently bid a 5 unit and the pricing scale that was used with 3 different national estimators we use as consultants was so low they warned us but we are comfortable with our market and costs. 

Different street 

They're very different thankfully so it feels like there's always at least one who's acting like a normal human being...A defeasance is something that happens on commercial properties when a securitized loan (like a CMBS [commercial mortgage-backed security] or agency loan) needs to be paid off early, either when you're refinancing or selling your property that has a loan on it.