They are top notch and are one of the few lenders I consider to be a true STR lender.  

Again, if your $250k is true, and includes all the electrical upgrades, new plumbing runs, potentially new foundation pour (since I assume the existing garage slab is not capable of supporting a new two story house), I am guessing since I don't know the market, but assume you will have a lot of equity by completing the project.

2) The minimum hours required are 750 hrs, but if running a short term rental, 100 hrs is supposed to be adequate, is that still true ?

Yes, This is true! 

I love that you are continuing your mom's passion, and doing it together. 

True, converting a personal Schedule E to a partnership will indeed reduce your IRS audit chances, statistically speaking.

That is "true"....Here is the bottom line, and I am going to skip over the entire foreclosure process unless someone specifically asks. 

Monthly payment is 1900 with a 6.5 rate and would rent for 2500.posted in another group but realized it was the wrong one Keith, as long as your true intentions are actually to rent it out and you get a signed lease this 100% can be a DSCR.

I came across an RE opportunity that seems too good to be true but number works.

Now this REALLY seemed too good to be true.