Current owner has been operating it this way for 7 years so he is lucky to have gotten this far without any issues. 

LOL, Shweta - I have incorporated these points into my elevator pitch :)  I am just finishing up a $75M 506(b) equity raise in conjunction with an MHC (acquirer/owner/operator) client of mine. 

The operative words are "automatic" and "millionaire."

So I got a real good education as we talked about everything from due diligence to negotiation strategies, operations, property management, tax strategies, lenders, financial analysis, etc, etc. 

So do these two companies require NMLS licenses to operate since they are not offering the loans themselves? 

While my business is in MA, all my rentals and my residence are in NH - so......After you set up the LLC per the instructions above, you'll still need an operating agreement, which most people skip. 

And they continue to operate.  

Definitely include property management fee (Around 10% for that size) in your operating expenses.

I asked to speak to the lenders supervisor or operating manager but they said I can’t talk to them.

A 400k SFR in a B neighborhood rents for 1800-2000 these days. 40% operating expenses and a mortgage take you welllllll into the negative.