Both of these products, HELOC's Vs AIO loan are first position mortgages and typically start out with interest only but its important to note that HELOC's are based on prime predominantly while AIO loans are usually based off CMT 1 year Index.If there are any questions on how this applies to your scenario or the risk assessment for your portfolio feel free to reach out and lets discuss.

Any idea what extent of damage has to occur for the "Force Majeure" to apply? 

We have a break lease fee (we operate in Kansas and Missouri) and I know we use a flat fee and not a multiple of the rent (I think because that way the deposit cannot be applied to it or for some reason with local laws, admittedly I don't remember).The main thing is though that 1) it's in your lease and 2) it's in compliance with your local and state laws.

Consider banking your $170k that would pay off the mortgage and apply for a HELOC for the remainder of your equity to 75%.

Whenever I have sought non recourse financing it's only applied to larger commercial deals and larger multifamily, so I stand corrected.However, in defense of my position I have 3 further arguments against buying real estate with your IRA.1.) 

This could apply to anything left in the common areas by one tenant that might potentially injure another tenant.

However, the remaining gain not covered by the Section 121 exclusion is taxed at your ordinary income tax rate.Here's how the calculation typically works:Calculate the Depreciation Recapture: The $9,000 of depreciation would be recaptured at a maximum rate of 25%, which is $2,250 (25% of $9,000).Calculate the Remaining Gain: Subtract the excluded amount (Section 121 exclusion) from the total gain: $100,000 (Total Gain) - $9,000 (Depreciation Recapture) - $250,000 (Section 121 Exclusion) = $0Tax the Remaining Gain at Ordinary Income Rate: Since the remaining gain is $0, there would be no additional tax on the gain.So, based on this calculation, it seems like there should not be any additional tax owed after taking into account the Section 121 exclusion and the depreciation recapture at a maximum rate of 25%.It's essential to review your calculations and ensure that you are accurately applying the exclusion and depreciation recapture.

I’m currently applying for the loan based on my income, credit score, etc and the trust’s assets.

Point is you aren't the source of information, you are just trying to apply general SEO knowledge to Real Estate people exactly like they are.

1) A down payment up front of $15-$30k per property (or whatever they can afford that you’d accept). 2) Rent (not applied towards purchase) - covers your mortgage, but no more maintenance or management fees, etc. 3) A windfall of the balance of the purchase price at the end of the term.Bonus: if they want, they can apply additional funds towards the balance of the purchase price on top of rent.