When looking at the property today, and the current rents that it is getting, anyone can see that the property is clearly underperforming.

When someone joins BP with a paid membership, sponsors a podcast, or buys a book, it's clear where the money is flowing. 

I would get clear on not only roles, but expectations.

Both can be quite expensive over a year and you want to be very clear on what those are, what they cover, etc before you purchase.

We are priced right and we clear about $1000 a month after expenses.  

I don't want to bother showing him the unit if anyone can give me clear insight into this situation that makes it a 100% no go.

It would also be advisable to discuss this with an SEC attorney for both personal protection, and hopefully the sponsors are doing the same to make sure they aren't getting in trouble.The conservative answer is: be a broker-dealer and you are in the clear.  

Then I plan on going back to my portfolio lender with 2 town homes and a duplex free and clear to pledge as collateral for around $600,000 in financing so I can go buy some more real estate.If you know what you are doing, this can be a very cheap and convenient source of short term capital.

Instead of asking questions and engaging in a long back-and-forth, provide clear instructions and you'll maintain control.Your focus should be on what you will do after the tenant leaves.

The "STR Loophole" as @Daniel Murphy explained below, is pretty clear "Materially participate & rent for less than 7 days, you should be able to write it off against active income."