Will this help mitigate the misbalance between shortage of supply of housing to with its growing demand?

I disagree that the 1065 would be the more complicated route.Relying on each owner to report, accurately, their share of rental activity on Schedule E, plus issuing 1098s to the parties not named in the mortgage would be more complicated and more prone to error, especially if it's being undertaken in a DIY manner..I concede a 1065 would be more expensive than DIY tenants in common, however it frees up the owners to pursue higher value activities and provides them greater assurance everything is being done as accurately as possible.If we want to say error is being mitigated by a tax pro doing the returns of the owners in a TIC situation, sure we can say and all agree to that, but IMO the compliance fees for a pro in this situation for all individuals would be higher than that of just engaging a pro for one 1065.

Hopefully questions like that and extra screening will mitigate some of this.For context, my wife and I just moved into our first househack.

You must do your best to mitigate damages by re-renting the place as soon as possible.

I also require a higher rent rate (25% - 50% more), the equivalent of three months rent in advance (first/last/deposit), and a mandatory cleaning fee so that I can hire professionals to clean after they depart and still have the deposit available for additional cleaning/repairs.It's a risk but you can make it work if you mitigate the risk to your favor.

It's those maniacs that buy homes cash via quit claim deed off of craigslist that really get screwed.Make sure your property manager is a licensed real estate brokerage.Understand you can not eliminate all risk, only mitigate it.

Lenders want as little risk as possible, and the thing you need to do is mitigate their risk by bringing money and/or experience into the deal. 

I offer to call the loss mitigation dept on her behalf to get the payoff via phone and crickets...so my question is....is she stalling?

If not, I'd explore partnering with a friend and mitigate your own risk while you learn together. 

I assume you are using cosigners but you still need a higher deposit to mitigate the risk.I would consider a double deposit and then split it among the five tenants.