The plan is to live in the worse off unit regardless of what property we end up buying. 

The programs are created for investors who buy distressed homes, repairing them and then either selling them or holding them for rental income and flipping the hard money loan to a long term DSCR loan where the rents will underwrite the loan.Program availability vary by state.

If you stay in this deal will you be missing out on winners or, like many markets now, are the margins so thin that you will have to take a similar risk on the next deal?  

@Marcus Amison, that is a question for a real estate attorney in the state you intend to buy property in.

This means that you will probably need to pay registration and filing fees in at least 2 states if you don’t buy CA property as a CA resident.Any lawsuits should be limited to the assets of the LLC and not your personal assets (assuming you run the LLC appropriately and the corporate veil is not pierced, some debate as to SMLLC).

I am a broker helping people buy.

I'm not afraid to buy, in fact I hate money sitting in the bank doing nothing for me.

@Jennifer Patton,Have you thought about buying a quadplex?

I'd rather try to retrain them and keep them then have a turnover right when we buy the property. 

The more I learn, the more I understand why a person would want to sell and buy this way:1.)