Also take off 1-1.5% on the front end for closing costs and another 1% for carrying costs. 

They carried almost nothing in liability.

He originally wanted $90,000 cash all paid at once, but he agreed to an $85,000 purchase price with 25% ($21,250) down with him carrying the financing at a 4% interest rate.  

Even though you cannot apply the passive losses to offset any of your ordinary income, you can carry forward those losses.  

Also what insurance do you carry on your properties and what is the insurance bill worked out on a monthly basis?

IMO any time a utility cannot be correctly parceled to the proper user in a multiple unit situation, the landlord should carry the full burden of payment.

I find myself trying to justify the valuation and needing to stretch the am schedule out on our seller-carry to 40 years to break even monthly.  

You could get seller to carry back 10%, but problem here is the location.

My credit card only carries 9.2% APR but if I'm paying a hundred-ensome dollars in interest a month and hoping for $2-250/mo cash flow from rent, I'm eating into that hard until that credit card is paid off.I hope that's helpful and makes sense.

Using sub-contractors, you pay for the work they perform, they carry insurance, license etc., in the long run, this could save you lots of money.