My long term goal is to reach financial freedom by building a buy and hold portfolio that consist of single/multi family houses.       

Interesting article linked below, and a cautionary one for anyone who considers buying debt in natural disaster areas where the home's value is lower than the debt.

As such, the plans will be largely similar in the ability to invest in anything the IRS rules allow for with checkbook control.The only real difference on the investing side is that IRA plans are subject to UDFI taxation on debt-financed real estate investments and 401k plans are not.  

I looked at the financials and NOI is 54k a month and cap rate is 5 percent on a 4.3 million dollar investment. 

Current financial statements and of proposed transferee and its principals, along with credit reports, real estate experience and background for each 3.

I bought some property in Oakland and Richmond during the financial crisis- but I agree, things are a little hot in the Bay right now..

Anything above that range will be outside the financial grasp of most tenants so it will be hard to fill vacancies.

So should I:a) mail to the financially distressed homeowners anyway b/c they may not understand their optionsb) mail to absentee ownersc) mail to high equity ownersd) mail to probatese) you have a better idea!

Given that we are carrying ALL of the financial risk, I am having a hard time seeing why this would be reasonable or fair.

(just expressing what I would do, not what I think you should do - it's your business) My goal would be get out of the situation as quickly and painlessly as possible and I would not sweat the financial impact very much.