Depending on how risk adverse you are, going out of state can make sense, but I always recommend investing in your backyard (or at least being driving distance). 

That would be dependent on you closing the deal. 

Brian,Because VT is a traditional rental market (ski houses), depending on the minimum duration you will be allowing for rentals (ie. monthly, Weekly, etc.) there are some regular carriers in the New England Market that will write it. 

Good question, they seem to be all over the place depending on the area and I am not an insurance specialist, I think typically 1.5-2x normal rates but I could be off by a bit i have been honing in on White Hawk if you know that development and its in the pines but it does have water system with hydrants but volunteer fire department ..

We then will either sell or keep it as a STR depending on what makes more sense for us. 

I think it depends on whether you have someone that you can trust in that market.

Since your property has high resale potential, some lenders may be willing to work with you.Cash-Out Refinance – If you’re open to refinancing, you could take out a new mortgage for a portion of the home’s value (say, 60-70% of the $500K), and use the cash difference for renovations.Personal Loan – If you have good credit, you might qualify for a personal loan for part of the rehab costs, though interest rates are typically higher than secured loans.Partner with an Investor – Given the potential profit, you may be able to find a real estate investor or contractor willing to finance the rehab in exchange for a share of the profits upon sale.Your best option depends on your financial standing, timeline, and risk tolerance.

Additionally, if your goal is to maximize personal financial benefits, consider profit distributions from the property-owning LLC, which may provide tax flexibility depending on your situation.By adhering to FMV, maintaining proper documentation, and structuring the lease agreement carefully, you can optimize tax benefits while staying compliant.This post does not create a CPA-Client relationship.

I understand that these rules vary depending on the state, but any thoughts on this?

This one I might take from the deposit, depends on how much if it is really worth it.