See responses to your questions below: Correct, California is uniqueTo qualify for REPS you need to meet a number of criteria, including (but STRs that meet IRS criteria generally don't need REPS to leverage tax benefits): More than 50 percent of his/her time working in real property businesses; AND, More than 750 hours of service during the year.

(We're from California as well) Everything has been extremely smooth so far and their staff has been excellent with their customer service. 

Basically/Hopefully that is watching rents hit your bank, and occasionally calling a repair service as needed. 

I'm assuming you are arriving at your cash flow number by applying Gross income - cap ex, maintenance, utilities, vacancy, tax, insurance, mgt, landscape/snow & Debt service?

I have had no issues with using their rent collection services. 

The differences between most software is subtle and may be how they bill for their service, support their product, or the process to use those features.

Usually having a servicing company helps the lender to consider that.  

I’ve reported this to the FTC and have legal counsel.

if he performs a service for you, just pay him for it. 

You're financed at 100% and would be in big trouble if (when) ANYTHING went wrong....would the property even cash flow enough to service all of that debt?