@Dillon Clark-don't pay extra down on your mortgage-don't use a HELOC-save up as much as you can-hope this helps

This is the first time I have done something like this, where it was for other reasons besides not paying rent. 

It seems more your fault for choosing the "lying" contractors from the tenants point of view, if you ask them to pay up, I'm sure they would.

I reduced my responsibility to only taxes/insurance while the tenant buyer does the maintenance, pays utilities and makes monthly payments to me. 

In addition, you would need enough working capital to pay for insurance (which will be going up a LOT in Los Angeles) and to pay for property taxes.Don't buy this unless you have substantial resources and a cash cushion to keep yourself safe.

If you have a lot of liquidity and a great paying W2 and can support your rentals, focus on appreciation/equity.

Conversation in local Bar, say I would pay all CASH How did you finance this deal?

It looks good) I stumbled across someone locally who does it, but I'm sure you could find someone there if you or other out-of-town investors like the idea of paying a bit more for that level of security and obtain a remote monitoring source of the exterior of the properties.

The rental income from the first home will pay for the mortgage/monthly costs.  

If you have a great-paying, long-term tenant, a small discount can actually save you money in the long run.