Many real estate investors swear by them, other people say they should never be used.The reality is that wraps are a little complicated if you have never done one and hold some small risk of a bank calling the note but CAN be a useful tool when used correctly with two (or three) willing partiesRegarding the terms of most residential mortgage terms, specifically the "due-on-sales clause", they generally say that the lender "has the right to call the note" but not the obligation.   

Once they are debt free, I will then feel more secure and more risk tolerant. 

Way too much risk for me.  

For example if you buy properties in certain areas of SoCal you may be charged a premium to due Fire Risk if you are too close to brush areas.

Hopefully, you won’t have any flooding issues.BTW, builders risk which most of buy for flips doesn’t cover hurricanes or flooding anyway, unless you add it.

All I can say if your getting started is to try and learn as much as you can, take a little risk and don't give up when adversity hits. 

I like this niche because it limits my risk on several major expenses - exterior and roof.

I also think we were not fully aware of the risks and how difficult it would be to get repairs done from OOS after such a large disaster.

It's those maniacs that buy homes cash via quit claim deed off of craigslist that really get screwed.Make sure your property manager is a licensed real estate brokerage.Understand you can not eliminate all risk, only mitigate it.

The Feds can just buy high risk MBS on the secondary market and hope for the best.