As I have been reading a lot of terrible experiences and stories about landlords getting burned due to tenants simply taking their softness for granted and especially taking advantage of a lot of elderly homeowners to live in the places for free and in some cases even filing lawsuits against landlords to simply make money out of them.

I think the reason why they suggest this is in order to avoid any potential lawsuits regarding Fair Housing Laws. 

Lawsuit?

Consequently, there are fewer commissions available for real estate agents.Secondly, there's the looming lawsuit against the National Association of Realtors (NAR), which threatens to squeeze the commissions that end up in the hands of buyer's agents.

Commission lawsuit has zero to do with the commissions builders offer. 

Of course its never tested because it is so rare for a lawsuit to happen that is not covered by insurance.

So, you end up paying money to file the lawsuit which gets added to what they owe.

Sometimes they teeter on lawsuits. 

This means that you will probably need to pay registration and filing fees in at least 2 states if you don’t buy CA property as a CA resident.Any lawsuits should be limited to the assets of the LLC and not your personal assets (assuming you run the LLC appropriately and the corporate veil is not pierced, some debate as to SMLLC).

In one of our local forums with a lot of wholesalers, they are quit to tell each other when things start to go south to file memos, and there are a couple of attorneys in the group who are quick to jump in and threaten lawsuits if they do.