@Matthew Wright you're going to have a hard time doing this.Currently, you are bypassing a LOT of regulation requirements by letting the prospects pay the 3rd party directly.If you want to collect Application Fees, you will need to take on all the responsibilities & corresponding liabilities of Fair Credit Reporting Act and Data Privacy regulations. 

I would try to avoid Berkeley and Oakland because the laws heavily favor tenants and who knows what local regulations could be passed. 

Consulting with a tax professional is highly recommended to ensure compliance with IRS regulations and to maximize your tax benefits.

Even if delivered vacant it can take a considerable amount of time to legally de-regulate a stabilized building and it mostly requires you to have the units vacant for a period time (no cashflow).

I'm not opposed to this strategy however, after looking into NC section 8 state rules/regulations, I have some hesitations.

This could streamline the process and align with their goal of Cousin A cashing out equity.Consulting a Tax Professional: It’s crucial to consult with a tax professional to ensure this arrangement complies with IRS regulations.

I have thought of syndication in the past, but shied away from it due to the legal fees to set it up and the regulations. 

For example, the Internal Revenue Service (IRS) has published various materials relating to tax regulations on real estate investments.Publications such as Publication 527 (Residential Rental Property) and Publication 946 (How To Depreciate Property) provide detailed information on rental income, expenses, depreciation, and other aspects of real estate investing.

I have decided to exist the NYS market due to the regulations.

Here's the link to the webinar and other docs. https://www.sml.texas.gov/news/precomment-draft-and-stakeholders-webinar-notice-mortgage-regulation-rule-review/The second is a Maryland case The Estate of H.