That may or may not cover your acquisition and rehab costs. 

@William Larson Make sure your insurance policy covers your complete annual rental loss.

The security deposit covers borrowers credit check and basic administrative costs before the loan transfer will be initiated".Any thoughts on this maneuver?

Yikes, the new requirements aren't that big of deal, but if they pursue those further options, that would definitely make it more difficult for people that want to do live in house hack with Airbnb to cover the mortgage.    

.- It was very text heavy, just pages and paragraphs of words which is really hard to stay focused on.I did the one for Texas, so maybe they vary a little, but I would choose a different program if I had to do it again!

If you don't have access to ready cash, then I would definitely have reserves to cover you when things get tight.  

@Colin Perry If your purchase price covers the 1st lien and 2nd lien ( IRS lien ) they would be paid in full.

BTW, as long as the lease payments cover your existing PITI, many lenders will take a high percentage of the rent towards you income, and it might 'ding' your debt to income ratio a bit, but probably not prohibit your going for another property/loan.  

Another food for thought is that if you do your own work and something goes wrong, your insurance might not cover it.

Buy another property I have an eye on in my target neighborhood for 90k with 20k rehab. it cashflows well and I would use the sale proceeds to cover the property, then refinance after rehab and pull out money again for BRRR. property would build about 35-40k in more equity following rehab in addition to the good cashflow.option c: 1031 into multifamily or larger property find a 600k property, put 150k into property as 25% down, mortgage the rest.