Seller is also willing to do any additional paper work needed to get this sorted out.

oops didn't get the mudroom/garage direct. not sure there is room to squeeze in a toilet or if it would look.

I was cold calling like a machine, I tried CRM but couldn't get it to work for my brute brain (Eventually I found close, and I could never operate again without it) so I used pen and paper. 

The borrower shows up at the closing table and signs the papers, pays the closing costs and whatever was required for down payment and then the loan funds. 

For cleaners - use TurnoverBnb or Properly AppI use the Thumbtack app to find vendors (plumbers, electricians, handymen, wall paperers, etc)Definitely make use of a program like Hospitable or OwnerRez to make conversations with guests easier and automated.Outside cameras are a must and asking for photos from your housekeeping staff after each clean is vital.

Is there any benefit of "collecting" rent on paper up to this maximum loss threshold or would it be better to report the maximum loss?  

If you are not going to go to college, I would then get in one of the trade schools and get licensed and work for 2-3 years to get up to your master license in Electric or Plumbing.If you plan to go to college, then you might also spend some time during the school year getting your real estate license...and working on the paper side of the business while you go to school...so that might be 2-3 summers and 2-3 years during school. 

If an owner says they are willing to hold paper it means they are experienced and will do seller financing.

Supplies - trash bags, paper towels, toilet paper or covered by PM?

I bought a small storage unit last year and manage it myself with 3-4 hours a week, no leaking toilets, nobody locked out on a Saturday night, no domestics, etc.