When you say they were incompetent can you provide more feedback for novice investors. 

I can see how starting with a 4-plex could provide better returns and learning opportunities without an overwhelming jump in complexity.

@Jason Lopez You don’t need an LLC to rent out a house in San Antonio, TX, but it can provide liability protection by separating your personal assets from your rental property.

You should check with your 1031 provider quickly.

But perhaps you would be better served helping a local experienced investor find deals and ask them to show you exactly how they analyze deals, what's good vs bad, how do they finance (debt vs equity) etc etc and understand their business model that has a proven track record by providing value to them.

@Jerry Chilimidos,Here is a list of lenders who specialize in lending to IRAs and 401Ks:https://www.biggerpockets.com/member-blogs/2810/50272-list-o...I don't know where your rentals are located and how they are performing but selling might be an option vs doing cash-out refi.I would certainly consider option C.

@Vina Merrill,I don't have much intel on Knoxville, but I’m active as an investor, turnkey provider, and builder in Chattanooga.

Additionally, you could also check with your insurance provider to confirm there's no active risk and provide that documentation to the lender as reassurance.

My point is certain things are learned with experience and 1) acting as GC once does not provide an opportunity to leverage the experience 2) mistakes can be costly.good luckHi Dan,thank you.

Provide them proof of your ability to find, fix, flip (or whatever strategy you plan to use), and then start with small amounts of their money.