I recognize the downside is my buyer defaults and I have to take the property back, but I am completely ok with this.  

Only downside is recourse but that probably is not an issue for you at the moment.

The downside....you will need to pay back 25% of that depreciation expense eventually when you sell it.

Downside is that you will have to pass the self-sufficiency test. 

The downside is that tax liens typically come with a lengthy right of redemption period (in Texas this is up to 2 years).

The downside is you will need to live in one of the units for 12 months.

I only see the downside.

If there is an accident at one house and the victim sues the LLC, the most compensation that he can get is all the property owned by that LLC...just one house.I cant see any benefit of having one LLC own multiple houses when, as someone else pointed out here, the cost of an LLC is $125 and potential downside is the combined value of all the houses.

Secondly, these were generally 9-5 jobs, maybe more like 10-8 jobs, since retail tenants only know something is wrong when they are in their store, so you don't get calls at 2am.The downside is not everyone needs a place to run a business, but everyone needs a place to live, so your potential tenant pool is smaller.  

It doesn't lock you into the bank or terms, so there's really no downside.