The rest is just liability to you..Also, it depends on what sort of investments you are doing. 

Yes, by paying cash for two of my properties (That wasn’t easy btw-took out a 401k loan, HELOC, withdrew 62k from our Roth IRAs and used all my emergency $ etc to get the cash to purchase the two properties), that extra cash flow plus the $200 a door on average I’m making on the rest of my rentals gives me plenty of cash flow each month in case the poop hits the fan.

This payback each year would drop my equity 1% each year until I hit 20%, at which point the preferred payback would end and the rest of the money would stay in.At this point, we needed to take out loan of ~$670k to finish renovations. 

The rest of the mortgage payment is interest, taxes, insurance, etc.So when someone says principle payment, was $230 and is now $300, like I said in my OP, that means the amount of the money that goes toward the loan amount from my monthly mortgage payment has increased.

In his opinion, my wife can draw salary and pay tax on it as a general partner (depending on how much we decide) and then rest will be distributed to both of us (don't know in which term) and will count towards our ordinary income, saving 15% in FICA/SS tax.

Good luck with the rest of the rehab!

Just turned 30, finally grew my portfolio to officially 12 units (Just under $2 million worth) generating a healthy avg. 13-15% cap-rate on each unit with traditional financing over the span of the last 4 years. 

@Eric Kundinger to be honest, anything can be negotiated but if I understand it right the private money will bring in the down payment and the seller financing is the rest?

After few hours he cancelled the rest of the showings for the day and that Sunday.

When you inspect the rest of the house, you should get a feeling as to whether there are likely intentional plumbing issues or not.