Should I be concerned the bank may have issues with this? 

What are the rules for removing this person, as I understand it he falls under hotel rules, not the landlord tenant act.

K1s show your share of income or losses from the partnership, and you include it on your respective personal tax returns.Now, to your partners.

With the exception of building a trailer on the property (these are hard to finance), this sounds like a good plan AND if you are using it for your business AND your business pays more than 50% of the rent (if you have more than 1 tenant), then this is a more financeable property in the eyes of banks and credit unions as it would be consider a commercial "owner-occupied" property. 

I personally walked and researched every property prior to investing to understand what I was buying, what could be done to add value and what I should expect in cash flow and appreciation.Learning what makes a good investment for you is absolutely necessary. 

.: My question is… Do people promote buying rentals due to some sort of  personal benefit/conflict of interest?

I agree with Andrew’s comments particularly because this is a home you personally lived in and know intimately.

My though process in undercutting the bank by 1 % was to possibly attract qualified buyers.

If you want something that looks nice Article and Castlery have some great looking stuff without breaking the bank too bad ($2-3K range).

I personally interact with each and every guest.