Then, I'd explain that I purchase at deep discounts, so there is equity to minimize the default risk, and I'd explain that the lender has a Deed of Trust, just like a bank carries a mortgage."

The particular line quoted signaled a tiny red flag when I read the word "obligation".

Hello BP,I am always looking for ways to save the most money on building materials for my rehabs.  I live in Philly (this is true of most places) and as folks who live in the area may know the Restore is a great place...

Certain zip codes are red hot.  

if the tenant is this bad about making payments where they live, chances are there are other red flags.

Some on Section 8.Would you consider this a red flag?

And, on the flip side, is extreme population growth sometimes a red flag?

Meaning how deep would I go in debt to get that return?

I think younger generations are definitely willing and wanting to live closer to work and will go so far as to live in areas they might not have considered otherwise (Deep Ellum, Bishop Arts, Oak Cliff, etc.) as these areas become more appealing through investment. 

You end up with really thick walls and deep window wells but this could be a much less expensive option than lifting the house.