You can avoid payroll by ensuring your structure your agreement with them such that they are a 1099 sub contractor NOT an employee (bes ure to get smart and play by all the rules!). 

Any advice on the best way to get started would be welcome since I am looking for creative says of financing that would help me get started.Thanks all in advance for your help!

@Salvatore Giancolai had this kind of behavior lately with my tenants, in other country (not U.S), but you need to be very clear like you did with the letter and very creative if you can speak with them over the phone or with your Lawer and do some tricks that can cause them to go out, by the law of course.Every one can agree with me that no one wants to be “marked” , because rent payment.Your credit score damage and a lot of other things.For both of them if they won’t be pay this , it will be almost impossible to find a place to rent.This is how i solved it in my country.And try to find more “regular” tenants next time..After i signed a contract with single mother with 4 kids that didnt open the door for me for more then mouth and did so much damage to the apartment ..I learned the best lesson in the world.Hope you will be fine , remember from every situation with tenants we learn something new.

The creative strategy I came up with is: 1) My VA friend is looking to find a place of his own. 2) he can apply for a VA loan which is 0% down, 100% financing, no PMI. 3) he can house hack a 4 unit property and live in 1. 4) I can put together the deal and manage the property. 5) SPLIT 50/50 PartnershipQUESTION: Form an LLC PARTNERSHIP?

I am open to any other creative ideas?

I have no pressing reason to sell or to keep renting it, kind of neutral about the whole thing.Both these options seem to lack creativity but figured I would post and get some other insight from everyone. 

I've been trying to find a team to invest with for years now and I think I found the platform to find a team or do it on my own with some creative financing. 

Also how to you ensure that you are getting accurate information with all of these online courses.

What is the best way for us to protect ourselves to ensure this guy is not bluffing?

That way, you can help ensure you are on the same page regarding what things constitute normal wear and tear, and what things will necessitate  a security deposit deduction.