Context:Traditionally you had to go down to a 15YF for the rate to be any lower than a 30YF, so people would do one of those two, and you never saw people do 20YF.A lot of banks are now discounting the rate if you go for the 20YF option, which we've been doing a tad bit more of in response to.The thinking behind the traditional 15YF discount was "heh, good luck freaking qualifying for it.... but if you have the income and DO qualify for it, it's probably a super safe loan, here's a discount on the rate." 

Collin,The San Diego County has pre-approved plans and major discounts as we are in a "housing crisis", this makes building my first option.

Of course I knew this going in, which is one of the reasons I got it for a huge discount.

Some quick back-of-the-napkin math indicates that you're currently giving your tenants about $11k per year in rent discounts on these 3 units (Assuming you could easily find renters at $875).

What is a fair equity stake for me (I plan on investing some capital as well but not sure as to an appropriate discount) as the principal relative to others input?

Add to this a discount on the cash flows due to a risk profile, and that cash flow may not look nearly as attractive...

Would be for properties I can get at a good discount so would probably require some rehab.

Trying to buy discounted notes in the secondary market is quite involved.. ( time wise) and there is a lot to know and learn.Alternatively you can become the bank by working with a very GOOD local HML who manages clients funds for new origination which are primarily fix and flip loans.. so lots of turn over and payoffs.. but a good broker will have a nice pipeline so you don't experience much drag.  

The target property almost definitely has to be a value add minimally distressed property that can be refinanced after repairs, or a straight up fix and flip.

I still have my regular job @ 50k a year but the properties pay for themselves, extra cash goes straight towards the principal on the mortgages.