Underwriters are going to look at the cash flow from your tax returns in analyzing the rentals. 

I then look at the cash on cash return because I think it is a more solid number and more accurate to calculate than an IRR or something more complex with assumptions such as appreciation, etc. 

It appears we can easily get the 1% rule out of SFR rentals (I haven't seen any duplexes in that county) in that area.3.)

Lessons learned:1)Fire a non performing PM early and often ... they NEVER get better.2)Don't buy out of state where you can't verify issues & solutions or easily take control to straighten out a mess if need be.3)Repeated visits for what seems like the same or similar issue are a red flag which should NOT be ignored.4)Use licensed, bonded electricians who pull permits.5)Trust but verify.6)Be careful about who even bids your jobs.

The rates and fees are higher than conventional (but in your case, you're not going to qualify for conventional, so that's not a consideration) and in our case, there is no requirement for tax returns or pay stubs so it's an easier qualification.Please colleague request me.ThanksStephanie

Seems like a lot of risk to return a 20k profit, especially if you are only paying for materials.

I want to be able to return the favor to them and be well off for myself as well.I want to thank those of you who have read the brief introduction about me and why I am here.

The options are either pay more for lower returns or go out and find the deals on your own.

I echo Ryan's comment on AMI, they have been great to work with in the past and they understand real estate investment construction (where to spend money for return, where to save, and what finished are durable for renters).

I am currently in the process of filing my 2015 tax return (extension) where I can remove those expenses to increase that year's self-employment income, but that income would be taxed at the 28% bracket so not sure if it's worth it.