The Justice Department’s acting assistant attorney general, Doha Mekki, put it bluntly: this case is about ending the practice of “putting profits over people.”

Whatever money they make off of securitization from the borrowers note is pure profit.

@Alex Hymanson  you should read the book...Storing Up Profits. 

Look for ways to increase profits but without cutting corners.

Keep in mind the more you write off the less money you will show as you net.If you have (2) full years and depending on how the accountant files your taxes you will have a schedule C more than likely or another schedule that shows profit and loss.

Whereas for me (at this stage of my investing career and my personal life) if a project is profitable and supports my ability to live somewhere with better cost of living and quality of life, the balance between the two can be just as valuable. 

Private investors want to invest in deals they believe will be profitable.

All of the multifamily I have looked at in my area are not profitable due to prices being much higher than rent currently.

Thanks Dennis, I think you're right that planning for a more conservative return would be a good idea.I re-ran my numbers at an even more conservative level:Lower ARV: $800,000Lower income levels (I'm assuming it will take a couple years to get up to full potential income, but giving myself 3 years was a conservative estimate):Year 1: 50k (NOI $1,000)Year 2: 80k (NOI $31,000)Year 3: 100k (NOI $51,000)My ROI numbers come out to:1% (year 1) 46% (year 2) 76% (year 3)This scenario seems like an acceptable risk to me, when the upside seems far more profitable.

I do this at least quarterly for some of my clients and they like being able to see the profit and loss reports.