A solid exit plan reduces the risk of default.Check Their Liquidity: Even experienced borrowers can run into trouble if they don’t have reserves to cover unexpected costs.

The main reason I'm asking this, is to understand how much cash I need to save up in reserves before pulling the trigger on a deal like this?

Want to store and spend $50,000-$100,000-$1,000,000 in cash every month. 

Leaving you to move and store their items if required by law, clean and repair, etc etc.

Do you have reserves in case the furnace dies?

I've included an example below to help illustrate this.So different lenders have different rates (which do vary even for DSCR loans) but these are factors they all consider.See example below:DSCR < 1Principal + Interest = $1,700Taxes = $350, Insurance = $100, Association Dues = $50Total PITIA = $2200Rent = $2000DSCR = Rent/PITIA = 2000/2200 = 0.91Since the DSCR is 0.91, we know the expenses are greater than the income of the property.DSCR >1Principal + Interest = $1,500Taxes = $250, Insurance = $100, Association Dues = $25Total PITIA = $1875 Rent = $2300DSCR = Rent/PITIA = 2300/1875 = 1.23If a purchase, you also generally need reserves / savings to show you have 3-6 month payments of PITIA (principal / interest (mortgage payment), property taxes and insurance and HOA (if applicable).

My question is if I made the HELOC go away from my cash reserves, could we then agree to seller finance the remainder and then use the cashflow from the STR to pay her plus give her a percentage to manage the property? 

I've included an example below to help illustrate this.So different lenders have different rates (which do vary even for DSCR loans) but these are factors they all consider.See example below:DSCR < 1Principal + Interest = $1,700Taxes = $350, Insurance = $100, Association Dues = $50Total PITIA = $2200Rent = $2000DSCR = Rent/PITIA = 2000/2200 = 0.91Since the DSCR is 0.91, we know the expenses are greater than the income of the property.DSCR >1Principal + Interest = $1,500Taxes = $250, Insurance = $100, Association Dues = $25Total PITIA = $1875 Rent = $2300DSCR = Rent/PITIA = 2300/1875 = 1.23If a purchase, you also generally need reserves / savings to show you have 3-6 month payments of PITIA (principal / interest (mortgage payment), property taxes and insurance and HOA (if applicable).

Integrity and care for one's long-term reputation is enough for many, and there are plenty of syndicators who were reserved, used good judgment, and paused in the last few years.

If you can get a 30-year loan on it and still make positive income, as well as appreciation along the way, it will leave you with more for reserves and more for other investments.