My understanding is that they're just applying for business credit cards for you, and charging you $3500 to do so. 

If there's a facebook group like that in your area, find it and respond to anyone looking for an investor-focused agent.And then there's direct marketing although I'm not sure this is particularly effective.

This is all assuming some type of rowhome style of construction, which may not apply to you.Beyond that, I have had success with my single family rentals.  

This means if your AIO loan funds are directed towards significant improvements of your personal residence, the interest may be deductible.

No, it only applies to properties held for production of income (rentals) or for appreciation (land) or both.

Yeah, we are going a different direction. 

I cant assist on loans in CA directly as I'm not licensed in CA, however I'd be happy to send over some referrals to some lenders who I'd normally approach for this project for you.

Invelo has been a pleasure to work with and extremely helpful with setting up my marketing campaign for direct mailing.

As long as you stay 100% business-purpose (i.e. no live-in flips or anything sniffing of owner-occupancy), the NMLS/regulations do not apply in most states and you will likely be good on the regulatory piece (as always, there are exceptions and you should always consult with a pro/research)

As you mention above, have one or both apply and complete new leases (at or near market value).