It's all run under the table currently and haven't had any problems, but want to formalize this as a business to avoid any hardship down the road.I don't know how I should be protecting myself here.

About half went into the down payment for the next house hack, correct with no HOA and used a little to upgrade some like adding central A/C.

Curt,I live in Florida as well down by the Gulf Beaches in Saint Petersburg.

I’m paying that balance down little by little each month though. 

Basically, you can receive a very low, and assisted, down payment on your home.

A door lock doesn't function, four cracked windows, a broken door handle...those sound like issues the PM should have found during the inspection.When you get a lot of repair requests from a new tenant and they seem to be legit, I would recommend they spend a week or two getting settled, write down all the issues they come across, then send your contractor to handle everything at once.

The police department just posted on Nextdoor app that crime is down 29% in that area because of initiatives that they have implemented so now they will be implementing the same things in Capitol Heights. 

@Michael LeeTo clarify, the owner is seller financing the property to you at 60% LTV, and you are putting 25% down on the property.

Once you get your systems down, you have a real estate business model that you can take to any market and be still be successful.Read this article on the "core 4".

This will clear your mind and slow down the process which, ironically, will speed up your progress.