The financial net worth of residents who own a home is much higher than those who do not.

You will likely want to use Hard Money for the purchase loan. 

I don't say this to sound mean, but you need to decide if you're running this as a business to make profit or as a cheap housing alternative for those in financial hardship. 

I aim to refinance the loan under conventional investment terms to avoid the high interest rates associated with hard money loans.With an excellent credit score, securing a loan shouldn't be a challenge.

I would only recommend using a commercial bank with a construction loan. 

So you could pay out 120k on a 50k loan if your house stays at 600k in 5 years.Also, if you pay it off in less than 2 years, they make 20% interest on the money loaned.

As for the future I hope to get a Heloc or other type of loan against it in the next few years to pay off the current owner and do more repairs.

I bought my first house with two loans, one for 80% and the other for 20%. 

While you noted you are paying from business accounts, whose name is on the loans?

You can also run your STR in your personal name or elect to start a company that operates the STR i.e. branding.If you do not qualify or for some other reason do not want or cannot qualify for conventional financing, you will likely have to go to some sort of DSCR or other business purpose loan route, and they will actually require you to put it into an LLC.