That might mean a large tax write-off IF the owner is a real estate professional (otherwise passive loss rules apply).Since your brother owns another business it is doubtful that he would be able to qualify as a real estate professional, but if he is married his spouse might. 

We've come up with some alternative solutions like they clean out all their personal items from the basement and garage in a short time period as well as stop smoking inside (heavy heavy smokers).

We even have a section of maybe 10 items that are the most important items to know about their lease it really simple terms and they don't read it.

However, no system is perfect and the PM can't be expected to have 100% success and protect you from any/all losses.

During the first 45 days make sure the paid items or items that have been paid down have reflected on all 3 credit bureaus before applying for loans.I hope this helps and have a good one. 

We had inspections done and the few items that came up were handled.

No way you can structure a business plan, go over a system, and create a list of action items needed to accomplish your goal.

I know a lot of people would look at this as a little odd, however, I am looking to get my feet wet and figured if I find a good deal, finance it with hard money, take a loss for a hand full of years (due to typical high interest rates with hard money) and then get a traditional loan later, would you do it? 

If all of those units are under just 2 business that could potentially be a problem.I would also look at my properties and see what big capex items are coming up, and take care of them now or set some funds aside to take care of them soon.

What were the big rehab items you had to deal with and how long did the rehab take?