Feel free to private message me with the details of the estimate and I would be glad to give you an impartial opinion.

Yep, it's all legal until the forensic audit happens.

I did an internal audit on this discount one year to track if the savings were worth the effort, we had a median savings of 43%, so yes, it was very worth it.

This is a strong audit topic for the IRS.If you are having a management company handle the property, you are not going to be materially participating.From the IRS audit manual: A trade or businesses is a passive activity if the taxpayer does not materially participate.

The downside is that you are likely to have to deal with regulations, MLS fees, paperwork, trust accounts, audits by the State, etc.Unless you are planning to scale up rather quickly, just working as an agent under a broker might be the easiest thing to do, plus you will learn a few things from them.

The next time there is ever any re-determination of intent is upon audit when you will be subjected to the opinion of one person - the field agent handling your return.  

If you get audited, you would have to be able to demonstrate that you had the intent to buy and hold for investment and not buy, rehab and sell/flip. 

Its my understanding some lenders actually audit their portfolios periodically to check for changes in the chain of title.2) How can I avoid cancellation of the title insurance coverage policy when using a quit claim deed?

Apparently you can take the same write offs personally as you can in an LLC, just keep track of expenses diligently and be ready to defend them in an audit, which you should do for an LLC anyway.

Local appraisers who  are qualified are placed on a list and assignments are rotated through that list.Mortgage bankers or wholesalers who purchase loans from banks will usually have a list of qualified appraisers and the originators follow that list to sell to them.There is an "audit trail" for the method as well that the lender must be able to show, it can be by the date and time of the application with the order for services, so there is no selecting your buddy.This doesn't apply to commercial loans, but it also depends on how many qualified appraisers there are in a lending area, if you have 15 MAI qualified appraisers then rotation would be a good practice, if thee is only 1, there isn't much choice. :)