Risk mitigation (other topics than transferring individual risk from you personally to the entity)2.

You need multiple profitable exit strategies in order to mitigate risk and maximize profits.

You may come the conclusion that the (often drastically) reduced costs of residential 30yr fixed financing outweigh the liability risks (which you can mitigate with insurance).Of course, there's a limit to how much residential financing you can carry (conventional wisdom says you'll max out at about 10 mortgages).

Though it sounds like you want to find a company to service, do loss mitigation, hold your collettral files, etc (the full Monty :-))

I am curious though, what kind of insurance policy would mitigate this?

A four plex has four pieces of income, which mitigated risk when you have a vacancy (vs having 100% vacancy when an SFR goes vacant).  

They hire a listing agent to take of things to get it ready to sell and to manage the process.It all comes down to who is submitting the best offer to mitigate their losses. 

so sponsor is doing all the work including due diligence, mitigation, foreclosure, modification, accounting, etc.

Think you can mitigate a lot of risk by insisting on inspections every 6 months.

You have a LLC, Company and Personal Insurance to mitigate the risk of what could be shifted to you.