Using terms like "total rehab" or "cosmetic rehab" or "carpet and paint job" might be just as good as a tidy number. 

You are totally right though, even though I feel that I am cautious I just can't have the same level of caution and fear that others who lived through 08 have.

@Nick Smith totally forgot about HAR.com great point. 

Most companies will max out at $500k then you need to rely on an umbrella policy for additional coverage.

I wanted to throw the numbers out there to see if you all had any advice or if I was missing something.It’s a duplex, electric is separate but gas and water are shared.Purchase Price: 71,000Annual rent: 18,600Annual insurance: 1,200(est.)Taxes: 2,883Garbage: 290Vacancy: 1,860(10%)Maintenance: 1,860(10%)Management: 1,116(6%) 775 placement fee (50% one months rent)Capex: 930(5%)Total: 10,914Annual mortgage: 3,453.6018,600-14,367.60=4,232.40 cash flowUnfortunately management is a must since it is long distance.

Or rely on my realtor to do a virtual tour of some houses?

If you and the wife combined make $10,000 a month, figure your total obligations shouldn't top $4,500 a month.

@Kole Kingslien  Guidelines for land contract:- Payoff of Installment Land Contract Requirements When the proceeds of a mortgage loan are used to pay off the outstanding balance on aninstallment land contract (also known as contract or bond for deed) that was executed within the12 months preceding the date of the loan application, Fannie Mae will consider the mortgageloan to be a purchase money mortgage loan.The LTV ratio for the mortgage loan must be determined by dividing the new loan amount by thelesser of the total acquisition cost (defined as the purchase price indicated in the land contract,plus any costs the purchaser incurs for rehabilitation, renovation, or energy conservationimprovements) or the appraised value of the property at the time the new mortgage loan isclosed.

So other than risk, what is the reason for using a HML for the total 130K, instead of using my own HELOC/savings for the 130K?  

@Eric C.It would not hurt your ability to borrow as it is still counted towards your total earned income (you earned it), you are just tax deferring it in a retirement account.