The rental income will more than cover the mortgage and still provide positive cash flow, which is rare in the California market, making this a great opportunity for us.However, underwriting has expressed concerns about us moving from a presumably larger home worth $606,000 to a smaller one worth $376,000.

Looking to find a good long term investment, but with not much to put down since it would be my first investment/home purchase. 

As a private money borrower, some of the biggest challenges often include securing favorable loan terms, managing tight deadlines for funding, and maintaining a solid relationship with lenders.

A bit long on the payback but add in any value increase to the property from doing it, including its increased attractiveness to condo conversion down the line, immediately better cap rate, etc...and it could be worth it.  

Purchase price: $130,000 Cash invested: $150,000 A buy, fix, refi and hold - after refi, we were $30k into the house.

But right now because you waited so long this is the best It can be. 

Then literally hundreds of these of come across my desk seeking financing - and typically the pro forma looks great while the actual historical financials show almost no more profit than Simple long term rentals after paying management fees, higher interest rates necessary for these type properties, increased repairs and maintenance, and faster depreciation.There’s also a personal reason I don’t invest in these properties ( I DO finance them).  

Some popular methods include seller financing, which allows investors to avoid traditional lenders by negotiating terms directly with the seller, and leveraging private or hard money loans to secure fast funding with flexible terms.

@Hansel Barretono, you buy the 4 plex with a low money down loan, and live in 1 unitisn't supposed to cash flow, just offsets your mortgage with the rentsbut of course you can even rent out the rooms in your unit and sleep in the basement or on a couch or whatever

In terms of REPS, this can indeed be a valuable strategy for offsetting your W-2 income.