In this scenario I'd recommend approaching your lender first and getting a bank appraisal on the property to figure out how much $ you technically have to maneuver with. 

Long-term rentals have their own set of fixed expenses such as background checks and optional property management, with variable costs like vacancies, evictions, and utilities, and unexpected expenses like tenant damage and unpaid rent.

Hi Logan,To give a bit more background...Right now I'm trying to stay away from student rentals, though being in Mt Pleasant and Big Rapids that might be hard to do.

Our background is in architecture, so trying to learn more about the business and financing side of the game. 

Technically everyone was a stranger before they moved in and we've never had any issues of stealing or squatting or any type of damage to the property.

It depends on the specifics and I'm sure a lawyer could point out some technical inaccuracies in what all of us have said, but I believe this is a legitimate avenue to explore to address OPs goals.  

PMC's can NOT technically get GL coverage on a property they don't have an ownership interest in!

Do the credit/background/reference check3.

I am starting from ground zero, with no prior background or capital to invest, but with a strong desire to create passive income for my family.I currently work as a middle school teacher in California, and while I love my profession, I have a strong desire to explore avenues that could potentially provide financial stability and additional income streams.

So technically, a 203k will not work for your situation unless you do a refi AFTER you buy it or do not pay cash but do a 203k from the onset.