I know that it is not the most popular take, but you need income and reserves to serve as a barrier between you and unexpected costs when you own real estate.

Its unexpected market dislocations - 2007 it was the unexpected size of derivatives markets that so few people understood.

You hope you'll never need it, but it's there just in case something goes wrong.In real estate, having a backup plan means being prepared for unexpected situations.Let's say you invest in a property, and you expect it to bring in rental income.But what if the property stays vacant for a long time, and you're not earning any money?

The best advice I can give you is to have a general plan for your day (ex: Cold calling on Thursdays and sending direct mail on Mondays) but leave yourself room to change things up in case something unexpected happens

I've encountered some unexpected challenges with my lender that have raised concerns about the investment potential in this area.Here's a bit of context: The property I'm interested in is a 3-bedroom (5 beds), fully furnished, with a creek in the backyard, a fire pit, a basement, and some recreational amenities.

What are your long term goals and how much cash do you have in reserves for vacancies and unexpected repairs? 

As exciting as the appreciation may sound, I do agree that you should have appropriate emergency savings funds to cover the unexpected.

We've been successful in metro Detroit - I don't mess with the city proper because I feel it is a bit too risky for out of towners; I drove into the wrong area on accident when we first started investing in MI and it really put me off of in-town Detroit.

People always say medical, unexpected repairs, hours cut at work, etc.

You gave him the option of paying twice a month and while he had an unexpected death in the family (I'd actually look for an obituary given all of his stories), he knows when rent is due and did not communicate with you that he lost his second job and was starting another new one or that he didn't have the rent together.