In my situation, I am only intersted in buying properties to rent in order to have enough passive income to support me (and my future family) in case of unemployment.

You are an investor and not a licensed technician.I do like the idea of doing a number of jobs directly to gain some idea as to what is involved.

I would think the average person would feel cheated if you told them you want to get their house under contract, only for you to make another 5-10 grand off the transaction.When you are wholesaling and net small gains like 3-5k, assigning a contract is fine.

I am a 48y/o professional with a desire to invest for long-term gains, not day-to-day income.This site seems to have a wealth of knowledge, and I have learned a lot already.My current plan is to invest in residential rental units, up to 4/property, at least at first.I look forward to asking questions and learning.

If I do sell it, great, I made some extra money and gained a lot of experience.

I hope to gain alot of info from you veterans.

Well, you're really asking two question;Pay down the second, andSell FSBO.The amount owed, and the amount you can get for the house have nothing to do with each other, neither do the amount owed and the (possible) gain on the sale.

It looks to me like if I did that, the net income/loss would be recorded on schedule C instead of schedule E, which seems to not be subject to the passive loss limits.

I would also suggest getting out to some of the local REI clubs to network and gain insight into the local markets from people actually investing and making it happen.

You can read until your eyes go blurry and still not gain a fraction of the knowledge a mortgage lender who is an expert in investment property financing has or especially that of your real estate agent (of course specializing in investment property).