My insurance provider has given me a warning that this will change my insurance from a standard dwelling/fire to a surplus line, specific to undergrad tenants. 

It’s looking like this will cash flow neg just with est mortgage payments plus insurance and taxes of $1100ish (after renovation), property management of $120.

Your new potential guests are insurance companies for homeowner displacement (flood, fire), buyers looking to move to the area but not sure where they want to be, sellers who want to sell but have nowhere to go, contract workers in the area, adjunct professors on a semester job, etc.

The you drain all of your savings unless you have more and how will you pay your taxes and insurance?

There is no such thing as a "guarantee" only the perception of.if it's a concern in your offer, find out what it would cost to carry a bond or insurance product for the seller. 

I'm hiring a property manager and the management contract requires a waiver of subrogation in favor of the property manager. I think I can get a policy online with the other requirements, but this waiver seems to be m...

Key things to keep in mind with your numbers are:Rent should be > PITI (principal, interest, taxes, & insurance) + maintenance + vacancy + capex + property management fee. 

After the purchase, Thorpe created 3917 Densmore LLC and established Walters, a Northlake employee, as the sole member of the new corporation, claiming that Walters was the homeowner, and that he intended to live in the home.During parts of the investigation Walters and Thorpe shifted responsibility from LLC to LLC and from person to person.

Principal, interest, taxes and insurance. 280k with 20% down at 7% = about $1500 a month for PI.

Insurance wrote a check for much lower than what contractors were bidding for restoration/remodeling.