You got bad advice from your prior accountant.You received rental income and it should have been reported.it seems like maybe he was lazy and/or doesn't understand rental concepts.The only exception is if he is paying 'under-market' for rent in which case the property would be considered personal use.I would fix the issue and charge him market rent. 

Renting by the room is almost like running a Bed & Breakfast or hotel except for longer term stays which is why they often are not allowed in R-1 residential neighborhoods.

If I Refi, I will pay him back against my lifetime exception, or if not I'll pay him and his wife $x each year, in accordance with IRS gift tax limits.

This is not lucrative to the seller at all except in getting the property sold.

Possible perhaps but I don't think probable.While there have been some exceptions and special programs that perhaps pay a bit more than market rent, I don't think it is that common.

There are exceptions of course but we usually want to work with smaller, local loan officers and brokers are usually the best option - usually.  

I am deeply regretful that I did not meet your expectations or provide you with an exceptional investor experience in Jackson. 

We use a YTD paystub and last year’s W-2(s) to calculate income several different ways:Hourly or salary income calculated to a monthly amountYTD income divided by number of YTD monthsYTD + W-2(s) income divided by the corresponding number of monthsIf these numbers vary too much, then we investigate and require an acceptable Letter of Explanation.Employment StabilityUnless an applicant has exceptional credit, we strive to determine their stability of employment to make sure they’ll always be able to pay the rent on time.

I have done that with all of my properties (except one - I am sure you can guess which one), and it has helped me gauge the market. 

There are suppliers in China who can supply pre-cut SIPs and they say they can source other exterior and interior finishes (except electricals and plumbing) from other suppliers and ship it.