Most Proformas will at least have a small CapEx reserve shown.In this period of rapidly rising rent growth and low vacancy, a lot of this gets glossed over because property appreciation covers any problems.So, here's what I would suggest.

What if when he finally moves out, there are damages or money owed not entirely covered by the deposit? 

Is payroll covered in management for your on site help?

I'm just trying to cover all my bases.  

None of the houses would have appraised for a high enough price to cover the added 3% an agent would have been paid.

Smelly, but covered in leads!

He then negotiates a price for the deed/lien, signs a contract with them and takes a down payment that will cover the price of the lien/deed from the state.

I should also note that I do have my real estate license, but I honestly don't have the time to use it, but man, I would save a lot of money if I did :D Target Profit Margin $18,000Actual Profit Margin $17,500Financing used: 80% of home and renovations covered by bank with an interest only construction loan.

Any snags that you've run in along the way that the book didn't cover?

If I listed it go get an agent or else I am going to cover my seller.