Generally speaking there are 2 main types of loans for investors: “Conventional” and “Portfolio”Conventional - I'll define these as loans that come from Fannie Mae and Freddie Mac (if you recognize those names).

Note that most of the time the Cost Approach is not used in valuation, so this functional obsolescence feature may not be recognized by an appraiser.An appraiser should note that on the appraisal form (e.g.

Could use it to fund a downpayment but your debt service will be very high so you will want to make sure it cash flows and if it does I would look to refinance sooner rather than later with a lender who will recognize the income the property makes not as much comps.

The courts recognize these leases as they are drafted with proper language and hold up in court. 

If you want to take that gamble, then that is up to you.

If you consistently analyze properties, it will be much easier to recognize a good deal when it shows up.

I do know some investors that try to buy things at assessed value assuming that 20-30% ratio holds true but without more information I associate that strategy more with gambling not so much investing. 

Just recognize the repercussions:You are taking away from the NOI of the asset.

Unfortunately, we do not qualify for REPS status and have too much W-2 income for the losses to be recognized.

Brandon,Some things to look for in an REI-friendly Realtor:Knows the market (more than just what is popular, they recognize trends and rent-growth opportunities)Understands how to analyze investments, and doesn't present deals that don't meet return requirements.