SC Coastal towns have gotten very strict with licensing, regulating, and permitting for STRs.

It seems like the rate environment has finally crested for sure. 

You're treading in RESPA-infested waters there and these are federal, not state regulations.Referral fees for ANY closing services on residential loans are strictly prohibited under RESPA regulations. 

As best you can find out the regulations and if possible the sentiment of the community. 

I know they have regulations but it seems from the government website you can operate in commercial zones (C-2 C-3 C-4 C-5 UGCCC, IX, RF, RV, CX, SH).

Every county has different requirements, such as minimum square footage for rooms; maximum number of occupants, hallway sizes (If there will be residents in wheelchairs); and safety regulations which are usually different that owner-occupied homes (for example- Interior fire sprinkler systems).  2.

We now hold it as a rental property that cashflows well with a 2.75% interest rate (got lucky with the rate environment at the time of purchase!)

I would talk to a lender about the 3.5% FHA rules and regulations as far as the self-sufficency test goes. 

I raise this because there’s no true regulations and it’s truly the Wild West of lending with tons of questionable participants. 

Some great resources would be here on BP, passive pockets, SEC edgar site (for example you can review Regulation A fund offerings as well as their financial statements to understand how to read audited financials).