They don't get to keep all the rent from the remaining lease and leave the unit un-rented or re-rent it and keep both rent payments....not how a lease works in court.There are ALWAYS exceptions to the rules, but in this business, you mitigate risk.... you cant eliminate it.

Eliminating recurring consumer debt to a manageable level if not completely, and budgeting.For example, clearing that $800 in CC debt or personal loan is better than seeking a property with cash flow of 300 dollars.Starting from a lean budget with a 3-6 month emergency fund is more plausible.

A second advantage I could see is the LOC would eliminate idle cash sitting around earning nothing when it could be better invested. 

One, San Diego and San Diego County are behind the ball on regulation of vacation rentals.This has become an issue in some communities, and if you are interested in exploring this, I would urge you to thoroughly investigate local VR ordinances and also any potential moves to restrict or eliminate vacation rentals in the market you are considering.

First, this eliminates inspections to get a loan.

You can borrow your own retirement money out for opportunities that you want to profit from personally, and the hidden tax that occurs in Roth IRAs (Unrelated Business Income Tax or UBIT), is virtually eliminated within a 401K.

There can be arrangements to reduce or even eliminate some risks, especially on the financial end.

That would eliminate most of these problems.

So, I'm wondering if I have to look at higher costs, increasing my risk, but eliminating some of the competition.I looked at a few foreclosures and the amount of work to repair was beyond my current financial capacity.

This will eliminate those who bring you "deals" that don't fit your investment profile or have incorrectly formatted or calculated information.