@Eric Le Yes that would be a solid investment, I like that FHA and 203k loans only require 3.5% down.

Our lender required the same thing as what you are saying so what we had to do was have my business partner sign a lease for us that stated when he would move in and how much he would pay in rent.

Am I required to issue a 1099 to my friend for his labor?

Most lenders will require 3-6 months title seasoning on a cash out refi with a DSCR loan.

(Yes plenty of my acquisitions are "wrecks" as you call it, and require significant expense to be made great...). 

They have higher rates and typically have prepayment penalties, however they require much less documentation. 

The worst scenario is if the seller or escrow really requires me to use my own cash, I will use my HELOC and cash to buy it.

@Michael Plaks:For the number of times you've had to post this, it should be required reading before being awarded a Bigger Pockets account. ;-)  Sorry to for my ignorance Ken

Hold it for forever, refinance as required to tap into equity and continue to grow our little portfolio.

If the home is only worth $365K you cannot refinance to take out any cash and switching to conventional will only increase your rate so there is no tangible benefit to a refinance from current to Conventional.You are sitting at around 90% LTV if the value is $365K so a refinance would still require PMI and rates are higher than your 5.70% right now even with a rate buy down.