This should be an extra little tax break for most real estate investors.

(Assuming cash flow was the goal when you purchased)I’d then evaluate the loans, balances, potential growth of said neighborhood and select whichever property has the lowest potential to earn over the next 5 years.That’d be the one I’d sell.Good luck!

If we allow a pet, we cannot legally collect an extra deposit amount for the pet.  

I was coming off a bad experience with a Multi level marketing company and wanted a way to earn a second income that didn’t involve that type of thing.

In that case his $5K is earning him $50/month for 6 months and then he gets his $5K back, he earned $250 or 5% in 6 months on his $5K, that's better than anywhere else he could have put that money. 

At this point I am looking to take real estate investing to the next step and have some extra capital to continue to build out my investments.

Also, if you're potentially looking to offer these people to invest in syndications via SDIRA, disclose upfront the potential of earning UDFI and/or UBTI which will in turn hit them with UBIT. 

So there was an extra person, I charge $500/pp, and she lives there for 9 months, so I can counter-sue for $4500?

The pro for you is having two people working to earn your business.

You just can’t add to the foundation of the home- add extra bedrooms, create an open floor concept, etc.