So, if the total payment was  2500 you would only need to cover 1000 dollars a month with your income. 

Add the financing challenges and that you existing structure likely will become rent controlled.  

The zoning office suggests reviewing the zoning ordinance, but the course didn’t cover zoning assumptions in detail.What’s the best way to verify zoning suitability and double-check zoning information?

both have 5yr pre pay penalty. 

Post '08' people had the luxury to analyze for "cheap" vs the pre-'08' pricing and feel a sense of security in there current price acquisitions. 

@Roman Balmakov If you are planning on holding the property long term and have enough reserves to cover even worst case scenarios it could still be worth it. 

Given your assumptions, you are not going to be able to get enough of a loan to fully cover the rehab, even with a hard money loan, so you'll need to pull in cash from elsewhere.One possibility is to have your mom sell you the house with a personal loan, not one attached to the property. 

Insurance would cover it, I would pay the deductible, and no assets would be lost.If you are in an area like San Diego where people are more likely to sue, a judge is more likely to find you guilty, and the payout is expected to be higher, you may consider an umbrella insurance policy.

Include a buyout clause allowing you to transition to sole ownership after two years, based on a pre-determined valuation formula or market value.Use an LLC to hold the property for liability protection and pass-through taxation, ensuring both partners benefit from depreciation to offset rental income.

A 50% LTV on a $120K house at 7%, 30 year Am results in a $400/mo interest payment.The cashflow on your existing duplex goes to $1,000 per month, but now you can buy another just like it so yoru cashflow goes to $2,000 per month.