@William Yeh   Under non-recourse loans, the guarantor is not generally responsible for losses the lender incurs, unless they commit certain bad acts; such as fraud, waste, damage or destruction, misapplication, misrepresentation, bankruptcy, or environmental contamination. 

Sounds like either way you are looking at losses so get them out now with eviction or  get them to come in line, start paying rent on time, and follow the rules.No legal advice.  

I have one rental property with passive losses.

Is my assumption of 30% loss way way too low?  

As for a separate personal reserve - yeah, if you expect major repairs, extended multiple vacancies, a credit freeze and a job loss to happen to you at the same time, hypothetically you may end up needing it.

It was a $10,000 loss.  

I don't plan or even think about failing, because of my purchase strategy, but I have an emergency fund in place in errr when that time comes and by fail in my terms that means taking a loss on a property instead of a profit.

I used to be ashamed of all of the losses and false starts that I have had.

@Nick Williamson  sorry, I was specifically referring to replacing or in any way compensating the tenant for loss of their stuff. 

The bigger guys do more volume so they can can absorb losses on a property here or there because they make up for it with other buys.