I.E. it is easy to get carried away and spend "just a little more" on those fancy counter tops, floors or fixtures, thinking that they'll add a ton of value, but end up making you go over budget. 

Oh and don’t forget to add in carrying costs (taxes, insurance, loan payments, utilities, etc.)

For the past several years I've owned the same single family home as a rent that had its own liability insurance policy and I carried my own personal umbrella policy.

And there will start to be a lot of work outs as the extension fee's and increased carry costs will start to put many of these borrowers into break even to negative returns..

Crash is CASH AND CARRY at least the GFC was.. 

You may want to carry the loans at the 4.5% and then sell. 

Depending on the HOA, if its a townhouse they typically do not cover much except common area items, a condo typically covers everything starting outside the drywall.For capex and maintenance, you need to put in the HOA/Condo Fees, ask if there are any special assessments coming, and determine what repairs you may have and capex (how long life does each item have) to determine what you should carry.

"If I could purchase your home in such a manner that you wouldn't make any profit off of me, ...I'm talking about not one red cent....could we finalize this transaction today?"

I couldn't tell whether or not FHA allows the owner to carry a second, but I could tell the buyer putting up the 3.5% was absolutely mandatory.

Your losses carry over into the future when you either sell the property or your income situation changes, i.e., drops.