Most of them fall into the price category that you described. 

What do you guys think of the way this is falling into picture?

I have had 3 deals fall through that seems to have taken the wind from my sail, making me wonder if this is the path that I should be taking.

I think I fall more on Beau's side of it, but let's discuss.  

I will be applying to several MBA programs with an intent to specialize in real estate with a start time of Fall 2015.

Why did their deals fall through, what type of businesses were they?

Our combined income is mediocre to say the least (85k/year, soon to be 95 - 100k) and have one car payment (300/m) and some cc debt (10k).We felt that we had a a unique situation on our hands because of the equity we have on our home, so we decided to do some researching in Real Estate investing and came to the conclusion of doing a HELOC and investing in SFH in Lancaster or Palmdale, CA.Chase, our lender only approved us for 40k with the condition to pay off our debt and car loan which only leaves us with around 6k.We are thinking about Lancaster and Palmdale because there are some properties that will fits our budget and fall within the 1 - 2% rule.Any advice?

Anyone else working niche areas of So Cal where there are MF properties that still would fall into this scenario?

There are a lot of strict rules for obtaining financing for an HP Owner Occ. so many times the deal will fall thru.

Having a hard time getting big lenders to look at this because Great Falls Montana is so small demographically.