I wish I could pull something off like that... basically, its a fee to make sure you don't waste the lenders/broker's time.

It's a little ways away from Charleston, which has kept it off the radar, but it's starting to become a more significant beach destination.

In the OFF-chance (not as common), you're looking to get into a DSCR loan...there are ways to get no origination or processing fee by originating your own loan (yes this is possible and you can do it in 39 states without a license).

After the novelty of owning a vacation rental wears off, it is a matter of the value of your time and interests.

The property isn't 'cash flowing' but our renters downstairs take $2,100 off our $5,700 mortgage so that comes down to my fiance and I paying $1,800 to live here.

Across the board, the worse the neighborhood, the better the cash flow, the better the neighborhood, the trade off for tenants base, better schools, low crime, etc etc.

First off, has the developer provided you with a term sheet (not a commitment) from a bank showing they'd lend 75% LTC on a mixed-use development?

This means that if you pay off the loan too early, then you'll pay a 1-5% fee off the loan amount. paying off the loan early means you either refinance or you sell the property, both would trigger a prepayment penalty to the lender. that being said, you can choose your prepay options, 5yr usually giving you a better interest rate by like a 0.25%, 3yr being most common and standard, and a 0,1,2 yr where you can buy down the prepay to be less years. meaning you pay 1% upfront of the loan amount to get a 1yr prepayment penalty so you're free to sell the property or refi after 1yr. 

At one point they fell behind by $2100 but has since caught up and paid me but did not pay the electric bill and it was turned off.

Or paying off my debt, while I provide them with a nice house to live in instead of an apartment.