My understanding is profit from lending is considered "taxable income" and is therefore added to your income and subject to your normal tax rate after all deductions, etc.

I do single family "off market" that I take over with owner financing, subject to, wraps and lease options.

I met with Wicked Smart today and was told they help you set up a lead sourcing system, help you structure creative financing - which is essentially lease option/purchase, subject to and owner financing....all strategies I am interested in learning more about.

How long will you go without hot water before withholding rent, calling the city or just moving out?

Small multi-family is hot right now due to house-hacking (low barrier of entry), and future cash-flow. 

If indeed it is stated that the second lien foreclosure is subject to the first, then no, the first will NOT be paid off. 

Have great weather most of the year ( few months get super hot and super cold ).

The weather is not too hot in the summer and cold in winter. 

Any area particularly hot?

Great to see you're in North Carolina—a lot of hot markets there.