@Juan Alvarez I don't think they have a rehab loan like that of the 203k, someone can correct me if I'm wrong. 

From experience, even if the tenant is in the wrong do you think they have $10k or even $5k laying around to pay for the repairs?

The only way I would report anyone is if I had clear evidence of wrongdoing.

If you use your own money, will you have any left in reserve if something goes wrong?  

Depreciation - assuming the entire 1.5M is depreciated over 27.5 years means ~4500$/month that I can deduct from my income for federal tax purposes - so would need to multiply by my federal tax % to get an actual $ saved value (im a little hazy on these things, so please correct me if im wrong). doing so doesnt make this a cash-flowing deal with a mortgage, and still wont crack 5% ROI if i buy in cash.finally, here's a link to the biggerpockets calculator for this - https://www.biggerpockets.com/buy_and_hold_results...So, is this a very unattractive deal or am I missing something here?

But, hey, if someone wants to prove me wrong, do so with a fully executed purchase contract and make an "I told you so!"

If nothing else, you helped a couple people out and you can't go wrong doing that.

I need some one who I can trust that will come to work and do a good job... which makes me think, if the contractor builds something and the inspector say's its wrong... does the contractor get monetarily punished ?

What could possibly go wrong ? 

She is located in the City of Los Angeles, by the beach.This seems to be completely wrong.