There are guidelines and guardrails, but a challenging deal can have positives and a golden deal can have issues below the surface.

So you get way better bang for your buck and there is still positive cash flow and deals that hit the 1% rule. 

I'd underwrite the property, with that low interest rate assumable mortgage, to cash flow positively from day 1 as a long-term rental, but be willing and able to use the rent by the room strategy or to rent out part of the property as a Short Term Rental to dramatically increase cash flow during my occupancy. 

It's certainly worth the cost of having him review the contracts and inform you of your rights.

Additionally, the price point is still cheap enough to find the 1% rule and positive cash flow and there's amazing appreciation potential.

Most likely your conclusion is correct, but the only way to confirm it is by having a real estate accountant review your tax situation.Also, please read this introduction if you want to better understand the concept:https://www.biggerpockets.com/forums/51/topics/1075919-five-...

that we’ve learned in our 24 years, managing almost 700 doors across the Metro Detroit area, including almost 100 S8 leases:Class A Properties:Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation.Vacancy Est: Historically 10%, 5% the more recent norm.Tenant Pool: Majority will have FICO scores of 680+ (roughly 5% probability of default), zero evictions in last 7 years.Class B Properties:Cashflow vs Appreciation: Typically, decent amount of relative rent & value appreciation.Vacancy Est: Historically 10%, 5% should be applied only if proper research done to support.Tenant Pool: Majority will have FICO scores of 620-680 (around 10% probability of default), some blemishes, but should have no evictions in last 5 yearsClass C Properties:Cashflow vs Appreciation: Typically, high cashflow and at the lower end of relative rent & value appreciation.

:Quote from @Jimmy Lieu:Have tons of examples of deals that hit the 1% rule and positive cash flow.

The work around is part of the application process is to tour the property, but still, why put yourself in that position?

& thank you especially for the positive affirmation, Collin!