The normal policy would be Depreciated Value less Deductible and that's a loose-loose.Regardless of the evaluation, if the GC will rebuild from the current condition, then the funds received can be applied however you please, but if there's a shortage, you will have to make it up. 

@Joel OwensBackground: The location is pretty sound and bound to improve more.

You will also make mistakes and thats fine- JK Rowling put it aptly -loosely quoted-  only those that dont ever do anything dont  fail- and in that case they have failed by default.

To little and you could loose your property.

Another downside is you loose on the advantages, of the Federal Tax Code, by not closing in the name of a LLC.

You're bound to get a yes at some point.Disclaimer: I know that this ladies job is not to help me find cheap properties... she is out to make money and she stands to make more money the more expensive the home is....

I’m not entirely knew to real estate investing, loosely studying it a few years back.

The money in a security deposit belongs to the tenants.It transfers CUSTODY with the sale of the property but the new landlord is bound for accounting for the funds when each resident vacates.

I get $200 more per month in cash flow if I choose 30 YR fixed conventional mortgage because of 30 year amortization vs the 20 year amortization for commercial loan.Trying to understand if it is worth loosing $200 per month for the sake of buying the property in the name of an LLC.Anyone else please chip in.

I am ok with loosing this guy, but I don't think I will.