I still have a day job, so more expensive property with higher rent, less turn over, less checks to collect, and less repairs are important to me.  

Non-bank mortgage servicing companies specialize in the following servicing functions: Calculating, collecting, and transmitting a mortgage loan borrower’s principal and interest payments; Managing mortgage escrow accounts; Collecting insurance claims; Distributing servicing advances; Managing delinquent mortgage loans; Assessing loans for modification and other loss mitigation activities; Overseeing foreclosure proceedings; and Managing and/or facilitating the sale of real estate owned (REO) following foreclosure.

I'm collecting $1,950/month from the three units and living in one of them now.

YTD  (1/1/15 - 6/30/15)Collected Income: $27,782Property Management:  $1609 (~6%)Expenses:  $6029Net:  $20,143My Thoughts:Reviewing the Property management statement provided above it appears several tenants are late on rent with no long term tenants.  

Does the bank need proof of income or is showing that we have made every payment to the owner for the last 2-3 years good enough? 

So they'll likely want to see your proof of funds or financing approval along with your offer to make sure you're a serious/real buyer.I'm not saying it can't be done, but you'll probably be a lot better off focusing your time and efforts on off-market properties.

Can you collect the rents directly from the tenants.5.

I've had them send me letters asking for proof of insurance but that is it.

As an investor, they enable you to collect unpaid taxes PLUS the applicable interest rate which varies depending on your location.

The mold is actually caused by the tenant leaving their clothes in a place that they knew water collects when there is heavy rain.