If you cave and accept a tenant you feel is not a good fit with other tenants, that could affect landlord-tenant relations.

For a third, I can't touch 1.2% rental yield in SoCal these days (maybe 2009, but not 2015), and would need to put something like 40% down (or LTV over my entire portfolio if HELOC used for cash purchase) to even cash flow (which is the price I would pay short term for that "insurance") or accept negative cash flow (definite no-go for me) for that 1 year + 1 day.

Keep in mind that many courts may not even evict a tenant that you have habitually accepted late rent from if you decide that you are fed up and want them evicted for late rent . . . this is because you have gave the tenant a reason to rely on you accepting late rent in the past and so, caused confusion. 

DON'T make these types a partner for yourself, lest you subject yourself and your finances to great and terrible risk.5) Tax implications - understand the formation of the LLC in Tennessee(you said you are looking at Memphis), how business 'flow through' income works for partnerships in corporations, and also learn which types of income are subject to social security tax vs.  

Welcome to the vibrant BP community, where you will find like minded individuals committed to REI and also helping others succeed.Since you didn't mention a REI area of interest, I added links below to the most popular niches, from which you can select one or all.http://www.biggerpockets.com/renewsblog/2013/01/04/how-to-rent-your-house/ (house rental guide)http://www.biggerpockets.com/renewsblog/2013/02/22/buying-rental-property/ (how to buy a rental property)http://www.biggerpockets.com/renewsblog/2014/01/07/flipping-houses/ (step by step guide to flips)https://www.biggerpockets.com/renewsblog/2015/01/31/ultimate-beginners-guide-real-estate-wholesaling-2/ (Ultimate beginners guide to wholesaling)Your time on this social media site will be well spent.You have taken the 1st step by announcing your readiness and commitment to embark on a REI career.Whether you pursue, wholesale, rehab & fIip or buy and hold it's up to you to decide.The bottom line is that you must take action to start.

I don't deal much in Bergen County but the question is why are you willing to accept even 5% as a cap rate.

Under contract means an offer has already been accepted.

Many owners accept cash payments and under report true income then expect a Buyer to "trust them."

Additionally, it's recommended that you bone up on the basics, so that when linked with a mentor locally, you will be ready to hit the ground running and be able to ask more intricate questions to rapidly build your REI career.http://www.biggerpockets.com/renewsblog/2013/01/04/how-to-rent-your-house/ (house rental guide)http://www.biggerpockets.com/renewsblog/2013/02/22/buying-rental-property/ (how to buy a rental property) http://www.biggerpockets.com/renewsblog/2014/01/07/flipping-houses/ (step by step guide to flips)https://www.biggerpockets.com/renewsblog/2015/01/31/ultimate-beginners-guide-real-estate-wholesaling-2/ (Ultimate beginners guide to wholesaling)Your time on this social media site will be well spent.You have taken the 1st step by announcing your readiness and commitment to embark on a REI career.Whether you pursue, wholesale, rehab & fIip or buy and hold it's up to you to decide.The bottom line is that you must take action to start.

Who wants to tie yourself to a house when you can develop an app, be the next Zuckerburg or accept that new job 3 states away?