There are not many true multi or duplexes here so I figure if I'm going to rent a room out, I might as well do some basic minor modification and nothing too structural and no one would really care.

One deal probably isn't enough to necessitate an LLC unless it's a large commercial holding. 

The next time she complains, tell her that you have offered her out of the lease multiple times and she's refused and the only modification you are doing is to give her 60 days notice as this is clearly not working for her or shorten the length of the lease-not month to month, but 4 months or anything less than a year and that frees it up during a time that you can still easily rent it.  

I know on the west coast this would have zero chance without major modifications and landscaping etc. 

., the 12-month occupancy requirement for a Primary Residence), andThe Servicer notifies the original owner or natural person that the Mortgaged Premises transferred to an LLC/LP must be transferred back to the original owner or natural person prior to any subsequent refinance or modification application to meet Freddie Mac's underwriting requirements.

I know this isn’t feasible for everyone but he’s ultimately going to be doing the work and he can pick up on any major red flags right away necessitating the end of the process.

I should be long dead and buried by then so I'm not going to worry about it.It seems that what I should have done is make modifications of the existing expired leases instead of creating a new one. 

His opinion is balanced and allows for a fair discussion on what a qualified management firm can do for it's clients.As to your primary questions, a property management company will not do your taxes, will not prepare K-1's, nor establish, monitor you entity (LLC, etc.).They will, upon your authorization, set up trust accounts in your entities name, collect rents, establish operating budgets, contract for services, pay bills, handle tenant relations, handle defaults, evictions, tenant improvements or turns, deferred maintenance issues, inspections, financial reporting, coordinate legal issues, leasing (if you so choose), maintenance, design modification, etc.Your biggest responsibility as an owner is to make the right choice concerning the person and company that is going to handle your asset.

Unfortunately, the compromise limited STRs to 100 days per year which is too few to make the STR a viable option (the costs of the Del Mar properties would necessitate too high STR rent if only rented 100 days). 

Loan Modifications are currently targeting around 4 million delinquent homeowners.