If you are lending to real estate investors - you should secure it with the real estate that they purchase with the funds.In the chance that it is still unsecured and it goes unpaid - you are eligible to report a business bad debt on your tax return.This loss would potentially be able to offset your other income reported on your return(W-2, interest etc).

The estimate value of the house(according to Zillow or Redfin is around 500,000 to 540,000).

You're right, it'll be tough to estimate exactly what the impact would be here in that neighborhood of NJ, but it's nice to hear what happened with other rentals.

Gotta get my estimates now.

I want to learn some skills such as how to find deals in my market, estimate repair costs accurately, attract tenants, etc. 

I ran it through a known property, estimate came out high. 

However it would be in your best interest to have your closing attorney type it up (chances are they have a template and have done hundreds/thousands) and it will be a lot safer for you.

I can't take a chance at greatness if I don't throw my hat in the ring, right? 

He estimated the cost for his labour to be about $700 and that wouldn't include repairing the walls. 

My first one has an estimated profit of $25-27k ( which was determined using the BP calculator).