Then a traditional rental once you move out, assuming you will rent the whole house.

You don't have to tweak much to take a traditional LTR lease and make it fit an MTR or month-to-month setup.

I think I understand what you mean by pass through's and that's probably company-specific.

The problem is HUD has been very sloppy especially over the last few years to record these, so often unless the homeowner remembers them , they bypass closing.

Typically they are not eligible for traditional financing which implies other funding sources (HML, private Monet, self funded, etc).  

If traditional banks aren't providing favorable terms, consider alternative lenders like HML or PML.  

I just have no idea how the contracts work, financing options outside traditional, etc. would love some help.

If you’re close to $150,000 in AGI, a few ways you can bring that down AGI is by maxing out a 401k traditional ($23k for 2024 tax year), maxing out your HSA ($4,150 for 2024 tax year), and if you have any capital losses from stocks (up to $3k per year), I would encourage you to have great bookkeeping to ensure you’re capturing all of your deductions appropriately on your rental property.

I've been interested in this type of investment and I'm guessing this is sort of different, since it's not secured by real estate which seems like the more traditional way to do it. 

I do not recall any other fees or charges outside of traditional closing costs and they were easy to work with and communicated very well.