I failed to factor in capital expenditures (aka improvements over time, not just maintenance) and property management.

ANY business that takes Capitol to grow will fail when forced to grow faster than the available Capitol will allow.

Many newbies think that Rent - PITI = cashflow, and thats the fastest way to fail in this business.

Ann is right that if you don't do your research, a larger unit will hurt more if it fails.

Stop making excuses, start taking action- Are you going to fail?

Talk is cheap - look at his credentials before investing in a mentor.Be smart about what you do and who you work with - you can look at listed real estate but your best deal is going to come from dealing directly with sellers.Also remember creative financing techniques - nothing down deals - Control and Roll System - Delayed Settlements - Hybrid offers - and don't forget owner assisted financing and make sure you always ask for a principal mortgage.Have fun - make full disclosures and make sure you understand the laws related to mortgage foreclosures - fail to do this and you may have a paid vacation to the Gray Bar Motel (a nice little room with one small window and the food is free, but the space is restricted).Remember your goal should be CASH FLOW or EQUITY - forget the emotional appeal - it is all about numbers - understand them and you'll do well in Charm City.Charles Parrish

that way if something goes wrong you only loss a "finger" and not your "hand"Cross Collateralizing is typically the first world you hear when failed investors start telling you their story.   

Since it was so minor with no permits and would only take a few hours, I failed to get a contract signed or even ask about his insurance status or anything to that effect. 

I failed hundreds of times while improving.

If the asset fails to produce, the debt is still the bad part that will bankrupt you (i.e. see student loans again).