What if they have collections or judgments?

Also, focus on 2 years of job/income stability.Class D Properties:Cashflow vs Appreciation: Typically, all cashflow with little, maybe even negative, relative rent & value appreciationVacancy Est: 20%+ should be used to cover nonpayment, evictions & damages.Tenant Pool: majority will have FICO scores under 560 (almost 30% probability of default), little to no good tradelines, lots of collections & chargeoffs, recent evictions.

The tenant will most likely talk nonsense and show the judge precisely who they are.Send the judgment to a collection agency, along with all supporting documentation.

You can find higher ROI (on paper) here and probably in other cities…but the probability of actually collecting rent significantly decreases.

Eviction costs surged and so landlords needed to increase rents to deal with vacancy and collection loss and increase their screening standards.Then the eviction moratorium.  

Correct, I need to apologize for keeping my example too simple when most people on here are much more sophisticated in investing than I am.

Quote from @Andres Lasaga: I am in the process of selling a property to the tenant I have been renting the house for 4 years.I want to outsource the promissory note collections and reportsIt would be only ONE property, for now, any recommendation of a company that can manage the collections and reporting?

Hot tub is notorious for collecting bad reviews. 

After collecting tenant pass-throughs for the year, do you pay the property taxes at the end of the year or the beginning of the next year?

Actually the IRS does not tell us what we can invest in, only what is disallowed (life insurance contracts and collectibles).Allowable investments for SDIRA investing include the following:Residential real estate, including: apartments, single family homes, and duplexesCommercial real estate Undeveloped or raw landREITs (Real Estate Investment Trusts)Real estate notes (mortgages and deeds of trusts)Promissory notes Private limited partnerships, limited liability companies, and C corporationsTax lien certificatesOil and gas investmentsPrivate stock offerings, private placementsJudgments/structured settlementsGold bullion Factoring investments