You will then have a few options with that rent money....you can put it into principal or you can start saving it to purchase yet another property.

There doesn't seem to be another option. 3) Do my spouse and I have to file two separate NPT returns for the rental income as we are joint federal filers?

Overall, there are a ton of really helpful suggestions in the replies here so I think you should definetley weigh some options in terms of if your goal is to keep the tenants or have the units be up to market rent. 

I am particularly interested in areas which I can either start earning right away as short term or long term rentals - Miami area or Bay area sounds like a good option for me.

Looking for long term financing options.

You would need to consult with a (local) lender to see what is available to you for that property, but I am assuming 20-30%.You would likely have 2 options with that property - 3 2 bedroom unit listings, or 1 6 bedroom listing. 

You may want to consider promo rates on an equity line as well and if they offer you the option to convert any part of the equity line into a fixed loan.

Open to any and all options and appreciate the advice/input from qualified, experienced, investors and professionals.Thanks in advance!

That leaves me to think the primary option available would be to look at a LTR instead.  

It's a good time to shop all policy options -- landlord insurance, commercial umbrella, personal umbrella.