Can try to reposition to Class B, but neighborhood may impede these efforts.Vacancy Est: Historically 10%, but 15-20% should be used to also cover tenant nonpayment, eviction costs & damages.Tenant Pool: majority will have FICO scores of 560-620 (approaching 22% probability of default), many blemishes, but should have no evictions in last 2 years.

However, I should note that this tenant has been late paying rent several times recently, which has added some strain to the landlord-tenant relationship.How would you approach this situation?

JMHO  I use a similar approach to paint sheen.

I’ll certainly take this as a lesson to leave no detail overlooked and to approach every aspect of my agreements with care.

They are billed as "a scientific approach to single-family rentals" and use "institutional grade property management," which usually means they are a tech company in real estate and likely either don't have the existing property management relationships in each area or you chose an area where they don't have enough units through Roofstock for the PM they chose to care.

It’s a move that worked out exceptionally well, especially in a growing market like Phoenix.Here’s how you could approach it:Unlocking Equity:A HELOC is great for flexibility, while a cash-out refinance might be better if you’re aiming to make multiple acquisitions quickly.

The income based approach to valuation is only used for commercial properties, that’s 5 units and up for multifamily.  

Can try to reposition to Class B, but neighborhood may impede these efforts.Vacancy Est: Historically 10%, but 15-20% should be used to also cover tenant nonpayment, eviction costs & damages.Tenant Pool: majority will have FICO scores of 560-620 (approaching 22% probability of default), many blemishes, but should have no evictions in last 2 years.

Anyone familiar with this approach?

I wanted to let you know that you could use a primary HELOC Mortgage and run a simpler approach to pay off your home early, or make principal payments, or save up and recast your payment.