We now are looking to create an LLC and setup the necessary legal documents to protect both parties and layout the terms of the agreement.

This is because DSCR loans do not follow/ pass consumer protection laws. when you live in the property, it creates massive problems for this loan type and the lender which would issue it to you. 

The states try to protect older folks but end up handcuffing them

Their service states that they ensure spam labeling protection up to specified numbers of calls and it was also mentioned when I called them regarding their services so I disagree that purchasing their multidialer service and being given a number that is marked as spam on the first call is anything less than unacceptable.

I'm not an SME on immigration law, but I know that you can get burned pretty badly if you run afoul of OFAC and AML stuff. 

Lenders that don’t require an appraisal will perform a desktop appraisal but will typically have a very conservative view on the value of the property to protect the company’s investment.

As a renter in Los Angeles, I almost view leases as an asset since we're basically a protected class here.

It is a protected class in several states...

Seller should record their lien against the property, you both should have an attorney review to make sure all interests are property documented and protected, and i think everyone is in a good place. as far as evicting tenants... this is up to what you and the seller can negotiate. i would still be putting on the same contingencies - appraisal, inspection... know what you're buying. don't get blinded by the seller-finance piece. 

Typically people only get insurance on things that they own, or liability insurance for their own protection.