His primary mortgage was sold to a private lender in the early 2000s and he claims he had to give an explanation each time as to why he financed with a private lender with such poor reputation every time his credit was pulled.

Hi Suzanne-I would suggest checking out google, reading reviews, and looking at different websites to see the top few that you think will provide value. 

I've held several different jobs just to make ends meet until this year.

Absent these type of relationships, I've seen to many projects get delay or fully stall out as the disconnected subs end up causing delays or the need to redo work that got done by a different sub. 

Trying to simplify while be efficient I currently only have 1 STR (studio attached to my primary) and I think this might be overkill to start. 

Short-Term rentals are treated differently than traditional rental property.

That would make a major difference on the underwriting. 

What would be the best and smoothest way to transition the tenants to a different payment option?

If you tell me the majority of the partners are merely writing checks and are passive LP's that's different but that's not what this sounds like. 

Here is a link that describes that issue in part. https://www.rocketmortgage.com/learn/fha-identity-of-interes...If this is meant to be your primary residence, why not deed the lot over to into your name and do everything in your own name?