Syndications are great for truly passive income, offering tax benefits and diversification, but require high minimum investments and long-term commitments.

Part of the motivation for congress writing Dodd Frank was to clamp down on the investors offering preditory terms re  rent to own and seller financing and that view has carried into craigslist rent to own adds and you say zillow. 

A mid-term rental could be an great option during the 6-7 months you're away since it appeals to traveling professionals, remote workers, or individuals relocating and offers stable income without the constant turnover of short-term rentals.

They are asking $375K but not getting it - so not quite $20k underwater from asking but they're offers so far are around $350k and lower.

Cash offers would net you less.  

You might want to check out listings in your neighborhood to get an idea of the going rates and what amenities other hosts are offering.

Do you let the tenant supply and pay for their own internet or is it recommended to offer internet and charge the tenant a flat fee?

Owners mistakenly ASSUME all PMCs offer the exact SAME SERVICES and PERFORM those services EXACTLY THE SAME WAY, so price is the only differentiator – so, they often select the first PMC they call or that calls them back!

I told the couple that I got an offer for $1,700 but wanted to ultimately rent to them but need the income.

However, many lenders offer only the 7A, so you'll have to shop around.