I don't have a solution but I think a real estate attorney or a title attorney would be a good person to talk to.

I will caution you that if they pull something like this and you immediately start offering any concessions as is repeatedly addressed above - this type of personality will make note of that and the threats will be ongoing for the duration of their tenancy.

This is not personal, but if a person cannot save money now real estate is the worst investment to get into as it is one of the most cost intensive businesses to be in.  

If you are sole member LLC you just take a distribution from your business account to your personal account.You are likely already reporting the income on a schedule E.

This might give a one-time (non-scalable) boost to cash flow, offer multiple value-add options, and allow the house-hacker peace of mind, via the assumed mortgage, in long-term breakeven or positive cash flow in the event that the value-add plans end up not being executed, and/or the person has to move out, and rent by the room or STR become unavailable for some reason at a future date.

Personally I like to build with cash to avoid the extra expenses, so I dont actually finance anything until its done and I have decided to hold it.

The second part is very personal and different for everyone. 

I have been to a few of them personally its really something and the folks that own them are under the radar and make MILLIONS.

These are my personal takeaways:Real estate has been more passive for me.

I would recommend targeting 30 day minimum rentals (Most associations are 90+), allowing 12+ rentals per year (most allow 1-3), and no in-person screening for tenants required.