In the end you need to look at your assets, your risk and your insurance and make good business choices based on the needs you have.The Land Trust will essentially offer a few benefits, but for this case the primary benefits would be avoiding the clause and removing your name from public record.

Chicago's north side has been booming for many years, and numerous neighborhoods have rapidly appreciated and essentially been rebuilt.  

I was thinking that I could put up the money on the home and just collect a "mortgage" payment from him.This seems very risky to me because he essentially has no skin in the game, besides having a place that he and his family can live for $350 per month. 

I understand the principles behind the math, but still prefer to follow this path.I would appreciate links to forums, blogs, or books from investors who practice or promote strategies for REI with your own money without leveraging.Thanks.

Essentially leaching off of your work without adding any value.

One that I work with in my land business requires me to essentially form a new LLC per each property. 

Even at a low purchase price of $50-75k in Detroit for an 8 unit (which is very possible but not be in a good area where you can charge market rent), a basic rehab budget of $5-$15K per unit puts you at an additional $40k-120k in repairs, which is essentially all of your $150k. 

If that is the best return you can get on $100K, then do so.You do a little worse because you end up with less principle paydown when recasting (the opposite is true if you are simply prepaying. 

Do you think at 7% DSCR it is even worth it, considering the fourplex will essentially just pay off its own mortgage + taxes and not have any leftover?  

Irrespective of the timeline by which you pay down principle, wouldn't you rather pay $42k instead of $75k on a NPV basis?