You make income from both places - and have a life insurance policy. 

They normally charge a larger percentage of income because STR are much more involved than LTRs.

I'd recommend researching areas to see that they have:- Low unemployment- High demand for housing - relatively low inventory- local job creation/booming local economy- high avg/median income- increasing population- low average days-on-market (DOM)- history of rent and property value increases YOY- low crime- highly-rated schools (or above average)I'd compare the target neighborhood to surrounding neighborhoods and/or nearest metro areas. 

Everyone talks about cashing out equity to buy more investments, but they fail to account for the cost of cashing that equity out, and they certainly don't mention the dangers of over-leverageing.It was hard to fail 5-10 years ago because the market conditions were ripe for investing.

I was told by 2 lenders that my DTI is too high because my taxes show a loss on rental income.

Everything that Account Closed said plus you are already being a nuisance to the seller in my mind.

Sell the home you currently own to a non-disqualified person then have them sell it to your retirement account...just in case you're thinking about getting creative.   

Were they reliable in getting the rent payments processed from the tenant's checking / savings account to the landlord's account?

If you have limited income, these situations can be difficult to maintain.  

HI Blake,You can always start off by house hacking meaning you live in one UNIT or ROOM and renting out the other vacant units/rooms to offset your monthly mortgage payment.There are several ways to run and make sure you are maximizing your rental income while keeping your living expense as low as possible.