I've heard varying opinions, some people say don't worry about bad credit in low income areas/some say you need to a little bit.

Many ask and are told it is a good idea to rent their personal home, I believe it is vary rarely a good idea.I prefer to invest where my money will earn it's keep.

@Ken Truong  I am not even going to attempt to give legal advice about this, and I don't think you should rely on anything on here as a basis for drawing up legal papers for a loan.The only thing I can say is hire a real estate lawyer who handles owner financed transactions to prepare your note and deed of trust, and any other disclosures needed for your transaction.  

That why it is better to specify the intent in the contract verses relying on what is common practice, typical, etc. which can always lead to disputes.

And at the vary least you have a heloc available for emergency fund to keep your property whole.  

You still have to research the sponsor fees (they vary a lot!)

Seasoning requirements could vary between institutions.

You can use a  Monthly Rent/Purchase Price (1-2%) as @Jason V. suggested and that is not a bad place to start but it doesn't take expenses into account which can vary widely (insurance, taxes, maintenance costs on older properties, utilities, etc).  

Brian Varmuza the answer will vary by market but in general, the hotter the market, the fewer the contingencies (including financing contingency).

Strategies can vary based on market opportunity, investor goals and simply investor preferences (regardless of returns)...lots of successful approaches.