Because, the lender is entitled to know what risk they are taking with their money.That being said, on seller financing, if someone gets sued and loses, the lien/judgement can be filed at the county, (it's not automatic, someone has to prepare and send the paperwork) which the bureaus will pick it up on producing a credit report.

Storing things.Even if the appraiser risked his license by not calling the bathroom out (why would an appraiser take that risk?)

We're probably not going to take the risk if we're busy agents to play that game. 

I have done extensive research in the risks, how to structure such deals to mitigate those risks as effectively as possible, and legal considerations of each strategy. 

The answer would be partially dependent on what are you looking to get out of it for rent and what type of risks are you comfortable with?

How do you balance the risks of holding during a market dip versus the rewards of appreciation?

If you live there you probably have a good handle on the subtle market dynamics.One significant risk of buying any property out of state is that you have a lot less knowledge and first hand experience with all the nuances of that specific market.

It can be done but each situation is specific and would be underwritten to see the risk and what the exit strategy is. thats the key with shorter term loans - understanding what the borrowers exit is.

If so, you may have less risk if you are comfortable with getting it rented / the MTR numbers.

Moves risk to be financially covered by insurance hypothetically.