Plan for the highest commission but if you get lucky and get it sold fast and for the lower commission it's icing on the cake.  

But rather make sure that each buy is worth it by itself and if you can then assemble a number of those 'free-standing-deals' and make it an assemblage - then that's icing on the cake. 

Break the ice socially, your objective is to communicate your abilities, knowledge, expertise, even if it is limited, you may well know more about RE than they do.Present the deal, just as you laid it out above is fine, be conservative and tell them you are being conservative.You need to figure out the structure you want, do you want it as a loan and secure them with a deed of trust or mortgage or do you want a partner arrangement?

This is either her being scammed by someone or her scamming someone, stay away.If you have such little faith in her, tell her what you are going to do, if you receive the check you will count it as her last month's rent and you are not going to give her the cash.Or I guess you could give her the option, if you get the check, you keep it as last month's rent or you return it, let her decide... what ever you do, put it in writing, no telling how thin the ice is over here.

Hi Mike,Thanks for breaking the ice!

Roofs need extra layering material (to protect from all the ice and snow), many plumbing systems use cast-iron drains (which are tougher to tie into than PVC), many houses actually have wells for water (ours used to, and now we have to abandon it properly), electrical codes are different (this should actually help us), etc.

Unless, you are a seasoned landlord who can handle this neighborhood (which I'm guessing is pretty rough just based on the numbers), you will get creamed on these deals with repairs, vacancies, etc.  

I of course add buffers in for changes in rates and prices, but for me real estate is a long game - mortgage pay down with appreciation as icing on the cake. 

It is just about what flavor of ice cream you love and the occasional bad taste you can stomach from it, keep going, and be happy still.    

Other suggestions would be appreciated on breaking the ice with someone with experience (everybody in my current circle are pretty negative about real estate).