The time back will free up more time to increase your active income, or acquisition of more rentals to get you more cashflow (passively or actively).

Exemptions to getting a 2nd FHA loan per HUD handbook are:-Job relocation 100 miles away or in another state-Increase in family size-Vacating a jointly owned home (ie - divorce or the like)

How will the partnership cash flow cover the HELOC payments if interest rates increase?

Other most common factor: Family Size increases due to marriage or having a child. 

Its a nice little cheat/loophole on the mortgage side that can help afford a larger home pice and increase your chances of getting a home or other loans.If you have any questions feel free to reach out I am always happy to help and go over the basics.

It’s worth considering the trade-offs between the stability of income and the increased oversight and hoops you'll have to jump through.

Your returns could be increased if you are willing to rent it by the room to individual students. 

I'll focus on maintaining the property and optimizing rent increases to ensure consistent returns over the years.

That sounds like a lot of work and I'm sure he would prefer to avoid that work and just sell it for $1.9m or $2.0m.if I were to buy it from him, to get to cash flow neutral I would need to increase rent on all 6 units to market rates and my monthly payment would need to be close to $6.2k/month, which would be $100k down payment, $1.7m loan with seller financing at 2% interest rate and flexible ballon payment.What would you do if you were me? 

You can always just increase the liability on your current carrier.