This would be very time consuming but if it is my only option then that is the route I will go.

2)Also, I read another Jason Hanson article "10 Documents You Must Use When Doing A Lease Option" Those documents sound expensive for me and time consuming for my lawyer (maybe not he works with lots of investors).

We also have the Consumer Federal Protection Board, a new policing agency and rulings cracking down on predatory investor/lenders.

Regardless of whether you have an interest only loan or an amortizing loan, if your debt service consumes all of your net operating income, your net cash flow is $0.  

I also live in your district so you are my Representative in Washington, D.C.As a manufactured home owner I am concerned about what is going to happen to the value of my home if the current rules set in place by the Consumer Financial Protection Bureau are allowed to stand.

This can be time consuming if you're planning to do it yourself.

If you do what is customary in your area you'll have fewer issues and you can be confident in what you do.

The 50% rule is just a rule of thumb that states about half of your rental collections will be consumed by expenses.

.* Another thought is that if rents rise over time (hopefully true) then the passive losses would be consumed partially that way also (ideal case).* I think a 1031 exchange causes the "suspended passive losses" to roll forward into the new property, so the depreciation recapture does not occur, but am not certain.In the end we personally still ended up wanting to mortgage our new purchases, under the idea that we could obtain several properties with the same amount of cash, and would have capital gains on several properties as well.

Then if the 2nd deal is a different type and needed to be held in a different company - then set up your 2nd company.You can set up the companies yourself at the local consumer affairs office or you can pay a paralegal to set them up with all of the proper binders that you will need in the future.