But, having to put 20% down each time is really depleting our capital.  

Hi Quinton,This may or may not be applicable to you, but if by "unemployed" you mean "on temporary disability, but my job is waiting for me when I get better, and we have an estimated return to work date," than this would be a scenario where ADA trumps ATR and you can still get a traditional mortgage.Fannie guideline on long-term/permanent disability, on social security disability, and on what may be applicable to you: "temporary leave income," which includes short term medical disabilities.For that last one:Just like women/men on maternity/paternity/pregnant leave, a gap between temporarily reduced income due to medical condition, and your normal income, can be made up for using asset depletion.

The problem is that there are no limits on how many short-term rentals a single property owner can operate, he said.In some Arizona cities, Drennon said, “bad actors” are buying and converting entire apartment buildings into Airbnb rentals, effectively creating hotels in residential areas and depleting local supplies of rental housing.By contrast, traditional hotels typically operate in commercial areas that have much higher property tax rates.Many cities around the world — from Paris to New York City and even Airbnb’s home city of San Francisco — have laws that limit short-term rentals to protect the hotel industry and residential neighborhoods.

What you said is true, and it's a viable strategy that will solve his problem, I just wanted to highlight the downsides and mention the capital depletion issue.

This would allow for me to still leave 50% in my IRA and not fully deplete, also perhaps would lead to a greater tax savings?

Active investors like you, who might have a DTI higher than some banks want, should ask to use alternative UW methods like asset depletion. 

And any pros or cons to using a hard money loan vs your own cash (of course besides the money lost on interest,fees and depleting your own cash reserves)?

And having cash reserves to pull from to avoid over-depleting long-term investments when markets are down (for retirees), is also wise.

The other option is to do a non agency product, such 12 months average bank deposits or asset depletion or DSC (debt service concerage) where 90% of the rent covers your total monthly payment 

We aren't even close to depleting those funds yet, but I try not to use them and save it more for an emergency situation.So at the end of the day I'm not worried about having to fork over money for the repairs.