It seemed like they borrowed a relatives bank account and edited the name & address to theirs.

You obviously have not studied enough this asset class.By borrowing from it you can make your money work at two places at the same time, increasing your total return.

I have a small real estate portfolio and a long investing horizon as I'm in my early 30s.Thoughts on why to stop 401k:- no match benefit- returns are very low avg. annual ~5.5% last 3 years net of fees- can only borrow up to 50k from 401k - limited access to capital until retirement age Thoughts on why it could be good to invest in ETFs or general securities example instead(SPY) :- higher returns 9% avg annual last 3 years net of fees - access to capital - securities backed line of credit (could be used as another form of liquidity to continue purchasing real estate) - long-term mitigated tax liability - if you never sell the underlying securities and instead use the line of credit as a form of liquidity to purchase assetsIt seems like this could be a long-term strategy with limited tax liability. 

(whatever it is you use).Some people borrow against their personal residence with a HELOCK for this needed cash, but I've seen those go bad in several instances, and the results were not very pleasant for the borrower.In many instances working a second job can allow you to set aside cash, or you might inherit it, or find a cash filled partner.But the bottom line is, initially your success is measured by how much cash you have to invest.And be careful of Hyperbole.Good Luck!

U know like banks that have long lost accounts.. escrow money that is refunded and cant find the borrower ( this happened to me personally LOL)  those funds go to the transportation department at the state.. so who could figure that out with out a little digging. 

What happens if a gator lender lends $20,000 on a transactional deal but the borrower "forgets" to pay back the gator?

You clearly have a propensity to borrow from Peter to pay Paul for things you want.

To get that you could only borrow $120,000 at 6% with a 30-year amortization.So even if you could find a property or MF property where your all-in cost is $154k/unit you could only borrow $120k per unit which is a 78% loan-to-cost ratio so this isn't a BRRR. 

As long as you are always realistic about the collateral value and the borrowers ability to execute the business plan, you can't go wrong. 

I recently watched a video where an investor bought a mortgage loan at a steep price, with an exit strategy that hinged entirely on getting the borrower to agree to one specific term.