Sometimes the HOA can cover capital expenses like roof and exterior, so that can help cash flow as well, but the HOA might increase the dues when they have to pay for capital items.

You might also consider holding back some of the sale proceeds in escrow until the seller has moved out as agreed.Make sure your insurance covers any work being done while the property is occupied, and check local tenant/landlord laws to avoid any issues.

They are covering cost of insurance, taxes, utilities and all medical expenses which are rapidly draining their available funds.

Typically, it would be covered by the late fee income. 

Why don't the banks simply charge a higher interest rate to secure the business and cover themselves?

We recommend you get management contracts from several PMCs and compare the services they cover and, more importantly, what they each DO NOT cover.

If one of the roommates (tenants) moved out the others had to cover the difference in rent or find a replacement tenant.

You don't have enough money for the deposit so how  do you plan to obtain the necessary funds to cover the closing costs? 

The umbrella policy also covers things not included in a regular landlord liability policy.

We recommend you get management contracts from several PMCs and compare the services they cover and, more importantly, what they each DO NOT cover.