Here are some very short guidelinesrefinancing after you buy and complete the exchange is less tax-risky than refinancing right before you sellIf you do refinance before you sell in a 1031, then your refinance should take place as early as possible and the primary purpose should not be for tax avoidance. 

In the last appraisal the month to month leases were flagged as risky and a comment was sent to the bank. 

This should give you a gauge on a) if they are prepared for the unexpected, and b) let you determine if the risk is still worth it to you.  

Too many uncertainties and unknowns could make this very uncomfortable and risky for your partner.

Personally for me this is too risky but I usually get a bit of both but the appreciation is something nice but not my #1 goal.  

However, this seems so risky to me as I've never bought a rental property before.

This road leads to cashing out a pure cash deal being . . . . precarious and challenging.A simple rate-and-term refinance (or knock-out refi as I prefer to call them) "knock-out" underlying debt and because of that are viewed as a far less risky endeavor. 

I was looking to get started with investing out of state while minimizing time and risk. I

In my opinion it is risky to dive in all at once for the learning aspect as well as not averaging out your purchase price or "buy-in" basis.

It is lucrative, less risky and requires very minimal involvement on your part.While real estate is a non-liquid asset, the benefits of passively investing in multi-family properties through real estate syndication far outweigh being illiquid.