You also need to talk to @Lee Smith ,Clay Manship  both straight shooters 

There are several good funds such as Broadmark and Arixa that give you conservative loan-to-value, instant diversification into hundreds of loans, the ability to liquidate quarterly after a lockdown, etc.. 

So essentially my w2 income would need to be able to qualify for a quarter of this loan if I was to occupied one of the units would this sort of loan be done at a normal bank or what would I need to do?

Most syndicators I know are on a quarterly distro.

I did it once per quarter for about 18 months.  

Recent article in Dallas business journal states Dallas is among the worst markets for flipping at a paltry 29% gross return on investment for the past quarter.

For buy and hold deals, the distributions are sent either monthly or quarterly.

Do you make this residual quarterly, monthly, yearly? 

Imagine if 90% of Burger King's sales were Quarter Pounders, and demand for Quarter Pounders dried up overnight.

Here's the 4th quarter economic report for Huntsville.