Depending on your debt to income, you might have to sell or have an executed lease to secure financing to buy the second home.

You still claim the income as miscellaneous income and deduct property taxes and mortgage interest (subject to SALT and other high mortgage limitations) on your Schedule A, but that's it.2. 

Even with that, I can't promise you won't have major issues and possibly lose the property or your monthly income. 

If the properties are split into more than one LLC, then each LLC will need its own accounts.Checking: collect all income here, then use it to pay bills.

I'm looking at monthly cost to seller vs. anticipated rental income, purchase price relevant to the ARV of the area and interest rate, balloon, etc.

We'd even be happy to move them into one of our (future) properties and just let them keep all/most of their rent income as free cashflow. 

-------------------------------------------------------------------Recommend you first figure out the property Class you want to invest in, THEN figure out the corresponding location to invest in.Property Class will typically dictate the Class of tenant you get, which greatly IMPACTS rental income stability and property maintenance/damage by tenants.If you apply Class A assumptions to a Class B or C purchase, your expectations won’t be met and it may be a financial disaster.If you buy/renovate a property in Class D area to Class A standards, what quality of tenant will you get?

Cosmo - I personally don't know Phoenix well, but if I had to do this in another city I would look at income levels, crime levels, and population growth (if you can) by zip code and/or area within a DMA as a starting point.

Throughout the year I come across situations where people need to sell there home due to a variety or reasons, job loss, income loss, health, divorce, etc.

If your new LLC is a disregarded entity (single-member or owned solely by you and your spouse in a community property state), it won’t trigger a taxable event, and you’ll continue reporting income on your personal return.