I tried having her read Rich Dad Poor Dad, I tried explaining on paper, none of it seemed to work. 

The numbers look good on paper but reality can be very different.

If you plan to originate and sell, to get yields into fair market territory, you'll be discounting your paper, meaning that your margin on the home will need to be high enough to absorb the discount and still produce a better return than just outsourcing the lending process.

Class C cash flow on paper in reality is losing money each month. 

I'm not sure he is still there, but he is using his own LLC to rent it and cover the paper trail. 

My understanding in Maryland the seller provides the buyer with a copy of the COA papers at least 21 days prior to settlement and you have up to 7 days to review and pull out of the contract if you don't agree to the terms.  

What if you could pay a little more on paper to get a better return later?

Without that, you have to be able to not only pay your own expenses, but also your first rental plus your second rental mortgage (at least on paper) with your other sources of income (ie money from your W2 job).  

We bought cabin 1 right before the Great Recession so on paper we had lost our shirt for a few years.  

Maybe he sees nothing because he screws up the paper work this one time.