Anecdotally, from searching Wake County (WC) NC records, defaults remain at near all-time lows, and I see this market (foreclosure/pre-foreclosure) as an opportunity not worth pursuing.

Usually for first timers and low down buyers the underwriting is a little more simplistic than traditional buy/hold investors purely seeking yield. 

Then I give an estimate of my certainty for each item and use that to calculate high and low values.

The risk of problems is extremely low, even in larger markets.

Quote from @Bruce Tieu: Quote from @Bonnie Low: It's easy to get ahold of the planning department for the particular city or County you are in.

It's automatically MTR (by the month).The best strategy is to do MTR in the low season and STR in the high season.

The reason you get the low down payment and the low interest rates are because you're personally guaranteeing the loan based on your stable income. 

Margins seem low and the risk seems high.

Low property taxes, landlord friendly and with tech and manufacturing jobs moving from the Bay Area there is strong job growth.

@Carl TrubLots of legal and tax implications - you should look at having them put the home in a living trust.I am not an attorney but there are ways to make it so your cost basis is today's value versus a lower value such as if you buy it at a low cost.