Which is our alternative.

I just need to get some more general information (you're thinking naturally I cant make an uneducated offer) from you..

I am concerned with the animal nature of #2 and potential problems there.What are your thoughts? 

There is a convergence of people being willing to live in smaller/alternative living situations (new generation) and the technology to make it happen (smart homes are here but alternative building techniques have been slow to catch on due to outdates building codes- but the technology is there) I think we are going to see some massive shifts in the next 20 years.

I know the California Franchise Tax Board imposes an $800 alternative minimum tax annually on any LLC doing business in (or operated from) California, no matter where the real estate is held. 

An alternative comment is that negative Cashflow is a delayed down payment.

I’d guess a note like this has a lot more grounds my guess of having a long stretched out foreclosure due to the sketchy nature of this.

I’m also open to alternative suggestions if any pro investors are able to offer input.

But today, you have a considerable amount of equity built in paydown and appreciation to access, and you can use that equity to improve the current house and purchase more.Many people find suitable alternatives to manage a handful of properties from a distance, so even if you move eight hours away, you can do most of the managing yourself by building relationships with contractors and real estate agents, paying a small fee for them to help as need requires.Only sell if you know the choice is mathematically correct, rationally made, and leads to more property acquisition now.

What is the process with that lender for a loan of this nature?