When they have something to lose, they tend to stay engaged.Foreclosure timelines and legal costs also vary wildly by state, so what looks like a high yield can get wiped out quickly if you’re not factoring in delays, legal hurdles, or damage upon taking the property back.It’s not that you can’t make money with underwater notes — you can — but if you're thinking of making it a niche, just go in with eyes wide open and build a strategy around low acquisition cost, strong servicing, and legal efficiency. 

Something like:“Our rent scales with the number of adult occupants, to reflect usage and property impact.”Just make sure that same rule would apply to any group of adults, not just this specific situation.Legal Risk & LiabilityIf those three individuals aren’t on the lease, it does open you up a bit:You can’t enforce lease terms against them directly.If something goes wrong — injury, damage, etc. — your liability coverage might get murky.You might also bump into local zoning or occupancy restrictions, depending on your town.What you can do:Add a clause in the lease that limits total adult occupants.Ask the caregiver’s agency to provide something in writing — maybe a letter confirming they’re licensed and insured, and that this is a formal care arrangement.Spell out in the lease that the caregiver's responsible for all occupants, even if they’re not on the lease.Also might be worth double-checking your insurance — make sure you’re covered for this kind of setup.Would I Rent to Them?

As far as damage? 

No damage, but messy. 

@Wayne Kerr @Calvin ThomasI need to address some concerning elements in this thread.

That being said, tenants are generally responsible for things they have installed or for damages that they have caused, whether by negligence or on purpose. 

They damaged  an expensive wood blind.  

The Tenant Classgreatly impacts rental income stability and property maintenance/damage by tenants.Both Property Classand Tenant Class affect what type of contractors, handymen and property management companies will work on a property.If you buy & renovate a property in Class D area to Class A standards, what Tenant Class will rent it?

I believe I'm about to get an insurance claim approved due to "storm damage" for a roof/siding, gutters, and shed for the duplex i currently live in (no actual major issues, just justified repairs based on what the roofing/siding company reported). 

The home was flipped just a few years ago, but I know damage can be done relatively quickly.