Consider all the things that could go wrong and see if the lease addresses them: unauthorized pets or tenants, early termination, security deposit, lease violations, late rent, eviction, lawn maintenance, parking, etc.5.

It has worked so far, but there are few things about it that we've had issues with (security deposits, rent receipts, etc.).

After the appraisal, I had instant equity of 25K.

You are young and have plenty of time and opportunities coming your way, just continueyour education.I see some people posting on here with credit card debt wanting to invest, which doesn't make sense to me, the best investment for them is paying off their credit card debt and they instantly make 20+% from not paying the interest.

Some arbitrage operators also try to get multi-year lease terms, security deposits waived, free rent up front, and the like.

You should use a state-specific lease that is clear regarding the start and end dates, the monthly rent, the fees that will be charged (ex. pets) and those that may be charged (ex late fee), the amount of the security deposit, and a clear list of rules associated with the property (no smoking inside is a big one as are rules related to parking).

Lender 2 requires 6 months reserves. they want the borrower to document any large deposits and they want mortgage statements on any investment properties listed on the 1003.The point is different lenders do different things and it's important to not generalize as a broker, but interview the borrower, find their pain points and marry them with a lender that will minimize those pain points for a successful close. 

After  exhausting security deposit is sometimes less expensive  to give them a stipend to leave.

So, what would be the difference of depositing rent payments monthly to the SDIRA (and taking my SEPP payment monthly or annually)?

Did you give a deposit and what is being done with that?