Put together a nice portfolio of your rentals, demonstrating your expertise in finding cash flowing property and managing them profitably.

Length of Self-EmploymentFannie Mae generally requires lenders to obtain a two-year history of the borrower’s priorearnings as a means of demonstrating the likelihood that the income will continue to be received.However, a person who has a shorter history of self-employment — 12 to 24 months — maybe considered, as long as the borrower’s most recent signed federal income tax returns reflectthe receipt of such income as the same (or greater) level in a field that provides the sameproducts or services as the current business or in an occupation in which he or she had similarresponsibilities to those undertaken in connection with the current business.

If you understand it, and the folks presenting it can demonstrate that they do it well, its probably worth doing your due diligence. 

I'm assuming the cost of PMI is based on the size of the loan and other financials such as credit score and income that demonstrate the buyers ability to pay back the loan?

Loan mod's drag out forever and rarely work.If they can demonstrate financial hardship, a short sale will keep them in the home longest payment-free and not have the default balance chase them.  

Here are some other fees you may see:Setup FeeMarketing FeeMaintenance markup feeReleasing FeeTrip ChargesA PM should make you feel comfortable and be able to demonstrate a track record of success.  

If the seller is behind and can demonstrate financial hardship, a short sale may be approved.  

I know she will come around to it if I could demonstrate some success.ThanksKishore

Using too aggressive assumptions (high rents & rent growth, low rehab costs & expenses, etc) will demonstrate a great return on paper but will inevitably disappoint investors when the deal fails to meet expectations.

Yes, they could move out of the one unit, rent for a period of time (long enough to demonstrate that they did in fact intend to convert to and hold as rental property), and then sell and they would qualify for the 1031 Exchange on the entire property.