Think of all the things that could go wrong and see if the lease addresses them: unauthorized pets or tenants, early termination, security deposit, lease violations, late rent, eviction, lawn maintenance, parking, etc.5.

If not, however, there are some pretty good private/hard money programs out there that may be able to get you started and build your reputation as an investor. 

Set up a separate bank account to hold their security deposits and rent5.

She then wrote us an email basically begging to be let out, stating that she already found other housing and put down the security deposit, etc. 

I don't really want to go into the private loan market. 

@David BiederbeckDefinitely convenience and security.

But ultimately we just got a really great FSBO deal.This is our first time securing a mortgage on a property we own and we assumed that it would be appraised at current market value.

Might be easier to find a private lender

And you can, IF you have a true private lender or friend financing you.

Traditional financing for the purchase and private hard money for the construction costs.