Since the latter isn't feasible in most deals, you need to pay less for properties today than you did on Nov. 7, 2016.

I need to investigate the feasibility and cost of doing this further though and confirm it would be okay with the township...but if it could be done for under $20,000 which I think is very doable, that would be a great ROI I think.

And he needs to seriously get on a budget...a monthly, written budget.If he purchased this as a flip, he needs to just get out of this deal and sell...probably at a loss.

I see a series LLC as a way to avoid getting sued; and an umbrella policy as a way to limit your losses once you do get sued. 

As soon as they stop paying, you at even more of a loss on top of eviction and cleanup costs, and the next tenant pays the manager a leasing fee all over again.  

We have been told by multiple companies that the losses are normally greater on the 3-4 family houses verse the 1-2 family houses. 

I am currently starting out getting involved in the real estate world. I am seeking funding and one option I have is I currently live in a reversed-mortgaged family members home. I plan to purchase the home from them,...

Just wait when these out of state investors try to sell...any cash flow will likely be wiped out and many are stuck with that reality of taking a loss eventually.

Wondering if anyone could give me insight (speaking very generically of course) into the feasibility of the above.  

You'll have to recapture it if and when you sell, but it's merely a loss on paper and can bring you back in the black in a case like this, so you likely wont lose money.