Lastly, with foreclosure there may be additional debts on the property.

@Samantha Klein- Keep in mind though that getting a refi on your property will affect your DTI (Debt to Income) ratio when applying for another mortgage on another property.

Fully leveraged is fine, but make sure that the property you're buying cashflow well enough to cover the servicing of all your debts. 

If anyone has any good books or websites they can direct me to that discusses real estate, business, or financial education please let me know.

Meaning, no one chooses to live in higher crime, lower rent areas, but because of their financial situation, that is where they end up.

I do not want the income to flow through to my personal return because I want less income to be reported for better college financial aid for my kids.  

You may be able to find a financial partner who wants to diversify and not do any hands-on work.  

Also have you read through the condo associations rules and checked to make sure there is not a large assessment coming or that the condo association is having financial trouble?

Mario Furmanczyk,seriously if you are determined to play with LA's rent control laws and renting in California in general,you need to find a very good real estate attorney who is an expert in rent control laws and California rental laws in general.California is one of the most difficult places to do business and landlords are treated like criminals waiting to be caught by our court system.You need serious protection with good lawyers who will help you stay in compliance and keep you out of financial troubles.Good luck to you.

I just read into buying multi units via FHA the other day and did read about the max number of units I just figured there were ways around it even if it meant putting down say 7% vs. 3.5 but if that were the case I guess it would still make more financial sense to stay with the 3.5 on a 4 unit.