First off, the cash-out refinance requirements have gotten tighter w/ the "seasoning" period.

We handle this all the time it's not difficult, just an extra step. 

And that extra $40-$50k a year will be life changing.

Marketing to Investors – Instead of listing traditionally, he targeted investor networks who specifically look for occupied rentals with cash flow.

Quote from @Anshuman Thakur: Can someone please shed some light on how- convert 401k to SD IRA- how to use SDIRA to buy properties- how much down payment is typically required if we are using SDiRA to only fund downpayment on a multifamily CRE, and which banks typically work with SDIRAs- how does LLC structure- property management and cash flow work in this situation?

Unless you have an immediate need for the cash I'd wait until I could pull out the extra $40k. 

Cash flow is hard to come by and I have considered looking elsewhere in more affordable states.

in cash flow would cut it for me. i'd want enough to cover the mtg, but also R&M and a little for vacancy. if i can't do that plus have a little actual "cash flow" left over.... i'm still here :) if that's any indication. 

There will be multiple markets you can achieve a 7.5% cap rate especially if you're buying with cash.

At $1200 in rent, you will probably have negative cash flow.