While you can start with a written agreement, a professional document will help protect both of you, particularly in terms of ownership, responsibilities, and profit-sharing.

This is my personal opinion, which probably won't be popular.If you are worried about the cost of hiring an attorney to create a proper operating agreement for your LLC, you probably don't need an LLC, and if you choose to use an online site to create an LLC, you probably get the protection you paid for.

For contracts, consult a real estate attorney and use standard assignment agreements to stay protected.

A well written management contract should clearly spell out what is expected of both the PMC and the owner, to PROTECT both and avoid misunderstandings.

This gives much better diversification protection across geographies, asset types, strategies, investment subclasses etc. versus putting all the eggs into one basket.The downside is that it's not for everyone, and a person has to be comfortable with turning over control to someone else.

If you are getting a loan no there is no way to protect yourself from crushing your credit or having a foreclosure against you if you are the borrower. 

Typically people only get insurance on things that they own, or liability insurance for their own protection. 

If I protect my numbers, interest rates would have to be 3.5% or so in order for a 1% house to work (assuming 20% down), which means for $3000 rental revenue to work, the debt load would have to be about $235K at that interest rate (give or take with variable taxes and insurance numbers). 

A well written management contract should clearly spell out what is expected of both the PMC and the owner, to PROTECT both and avoid misunderstandings.

-Start at a title company- they will help you structure liens and deeds so that your interest is protected properly.