Obviously this isn't the typical scenario for an investors first project.

..that they essentially have a "middle man"?

Typically, I do about 5 flips a year on the side, but the main business is rentals.

The concept of an unlimited ROI was intriguing (using a hard money loan to pay and fix a buy-and-hold property and refinance after completion with essentially no money down).My questions are:1-"What happens when loans dry up such as during a recession?"

It sounds like you're more interested in typical cash flow markets, of which Sacramento is not, and Memphis is.

You'll typically have a lot of tenant challenges not to mention that you're maintenance and CAP Ex expenses will be a much higher percent of your gross income due to the fact that it costs as much to fix a leaky faucet or replace a furnace on a property renting for $900 as it does on one renting for $600.

It is typically best for big value add projects, not small 3k/unit rehabs since the survey itself cost you a few thousand bucks. https://www.irs.gov/businesses/cost-segregation-au...

.  ;-)  On the good side, I've been considering the BRRRR strategy instead of my typical buy and hold plans. 

Prior to that, you may be able to get a loan based upon the appraised value, but it will typically be at a lower LTV which will basically put you in the same position as if it were based upon purchase price.

Well the last time they were selling it, no one would buy that house even though it was priced $100k below what it would typically sell for.