I'm completely new to real estate, so I'm trying to figure out how much risk is involved in gaining solid wealth through REI and whether that risk is fairly compensated.To me, understanding risk is part of "doing the math" and being an informed investor.

I've been through the RTA a few times not enough to memorize it but enough to know that I need to do my homework and I'm in the process of  setting up my screening package.

Know the price point is pretty high compared to other areas, but the math can work.    

As much as it doesn't fit the 1% rule, if the math works out and your initial estimates are very conservative, why not. 

I had him walk me through his math like 4 times...but sounds like we both were using the wrong formulas here.Sigh...this puts me in even worse positioning then.  

Scenario 1 is a ton of info that I did not think about as far as running the math to find out what the NOI would be.

Many wanna-be investors (not applying the right "maths" to the deals and overbidding) and plenty of out of state money has flooded the area over the years ...

If he can get $200K+ and owes $170K walking away with $10K should be doable by any ones math. 

@Crystal Salton It sounds like you have done your homework.

If I did the math right if you are  earning 18% on the $3433,77 your effective interest rate on the entire $10,074.63 is only 6.1%