In the event of foreclosure and ultimate sale, it's pretty easy to do so long as your loan was fully covered, what do you do for any loss, who collects first?

Hard money or whatever you are using to loan on the properties leverages, but it not only amplifies gains but amplifies losses as well.

I tried it back in early 90’s in St Louis, a rehab, then Dick Cheney cancelled the A-12 and lots of us loss our jobs.

It covers replacement costs in case of fire and I think the liability coverage is $300K/house + loss of revenue etc.

Well I do know the banks are not really paying loss mit fees anymore so I guess you have to find someone to pay them.

So the ideas or qualifications will weight and balance each other. 

You step in, improve the property, cure the loss to lease problems and make money on the spread.

I wants to address 2 major concerns. 1) Liability protection 2) Tax Savings both are important.Issue #1: Eligibility for S Corporation Treatment: I have been told that Loss of eligibility can occur if the S corporation receives too much passive income. so in my case I am creating rental leases on my S-Corp name and not on my personal name. is that OK or my S-Corp is in trouble?

Sorry for your loss ,But lots of people spend their own money and end up with negative cash flow .

LLC or not, you must have adequate insurance protection.However, to nit pick a bit, none of this with PREVENT you from getting sued, they will, rather, protect you from personal loss if you do get sued.