But when I say full gut and rehab I'm talking: taring everything down to the studs, updating plumbing and electrical throughout, probably upgrading the panel, adding duct work for heating and cooling, new mechanicals (boiler, A/C, etc) , hardwood floors, new kitchen, new dry wall and insulation, paint, finish work, etc.

One point that I have not seen mentioned is the ongoing CAPEX / Reserve allocation; Common area upgrades / refinishing, Roof, Cooling Towers, Boilers, etc, etc. all have to be done at some point as you know from your residential experience.

But lets face it , in America its cool to "rescue" pets now a days and esp pits.So you know these young couples are gonna be into that... 

Not cool.

I think it's a cool idea but I would charge a "per property" fee rather than a "per month" fee.This way it opens you up to owner-occupants and primary residences as well as investors.

cool.

Assuming we’re cool with this new person, what does the paperwork look like?

.  :-)  Unfortunately no cool moulding or door knobs or anything of much interest... just the original fir floorboards (*beautiful* tight grain) we'll do something neat with.Been working on this project for 20 months or so - it's an urban subdivision and new home construction.  

If you have enough income yourself you will not need it leased up- if you go for portfolio financing locally they will most likely want the property to be leased up first and possible the above habitability as well- if you're looking for hard money you will not need habitability or leased up but as a downside the rates/terms are not as good- private money - wild west any thing goes as long as the lender is cool with and you're willing to borrowSo it depends on what condition the property is in currently and if its getting leased up soon?

Other openings between the garage and residence shall be equipped with solid wood doors not less than 13/8 inches (35 mm) in thickness, solid or honeycomb-core steel doors not less than 13/8 inches (35 mm) thick, or 20-minute fire-rated doors, equipped with a self-closing device.R310.4 Bars, grilles, covers and screens.Bars, grilles, covers, screens or similar devices are permitted to be placed over emergency escape and rescue openings, bulkhead enclosures, or window wells that serve such openings, provided the minimum net clear opening size complies with Sections R310.1.1 to R310.1.3, and such devices shall be releasable or removable from the inside without the use of a key, tool, special knowledge or force greater than that which is required for normal operation of the escape and rescue opening.R314.3 Location.Smoke alarms shall be installed in the following locations:1.In each sleeping room.2.Outside each separate sleeping area in the immediate vicinity of the bedrooms.R315.1 Carbon monoxide alarms.For new construction, an approved carbon monoxide alarm shall be installed outside of each separate sleeping area in the immediate vicinity of the bedrooms in dwelling units within which fuel-fired appliances are installed and in dwelling units that have attached garages.Note: In Washington State CO alarms are required on all homes sold.No egress thru other bedroom?