A DSCR loan allows for a cash-out refinance based on the property's cash flow, and a quitclaim deed at closing can transfer the property into an LLC, with only the transfer tax to consider.

I do look to grow beyond two properties, but not necessarily at a rapid pace.Finally, if I were to do this, what are the proper steps in forming an LLC and then transferring them into that entity?

If you have a loan, you may wish to look into due-on-transfer clauses.

My list includes - last 2 years employment history and current employment [2 paystubs], criminal checks, eviction checks, No Pets, No smoking, tenant pays utilities, maintains landscape, no subleasing, bring own washer & dryer, 1 month security deposit and transfer of utilities before moving in, rental insurance, all occupants will be on lease, notice period of 2 months for termination, tenant references, No cosigners, no painting walls, late fee notice, any hoa fines should be paid by tenant, inspection of property at 3, 9 and 12 months.Please let me know if I am missing anything.3.

All you're doing is transfering cash from your bank account to the property. 

But don't see enough near-term or mid-term upside to keep them if something better comes along elsewhere that I can transfer into. 

Will I still have the same rights even if she transfers the lien to me? 

I have looked at a warranty deed transfer or a quitclaim.

You may also be able to simply QCD the property in your LLC but you run the risk of the current lender calling the note due because of the transfer. 

@Corey Crowley You can transfer the property to an LLC during the closing of the DSCR refi loan.