Also, as said above, the houses you're buying for BRRRR are usually in awful shape and won't qualify for a regular loan. cash or equivalent up front is the most efficient way.  

If this was a standard rental process then yes, I'd recommend going through the process of applications/screening steps, a background check, and then require the deposit; since it sounds like the house is being rented to transient workers though, the very nature of the work situation calls for a bit more flexibility on the renting end.

My experience of human nature is that if he already has the money, he's less likely to be concerned about his performance and if we're happy with him or not, etc.Another option is to wait until the summer months where the service calls are 3x/month, and then let the vendor opt to take the $550 average per month - that way we have the leverage if he decides to quit early or if we're not happy with the work - if anything, we would owe him money instead of him owing us service.So one factor is who has the leverage.The other factor is if there's a benefit to having the monthly costs consistent every month - does this matter to you as an owner / property manager?

my understanding is also that "active" would generally mean :‘regularly and continuously’ engaged in the business of leasing or renting real estate for income or profitnow we enter a grey area of conversation and back and forth, etc. on what this means.... just thought i'd drop this out there.... thoughts @Michael Plaks ?

Section 8 or regular if it doesn't get approved.

You might be able to convince a seller to hold the mortgage note (ie seller financing) and have you pay them in regular installments, but even in this scenario the seller would typically request some sort of initial down payment.

I was chided for "giving legal advice" on another post when I was telling about my experience, so that this does not happen again I'll say I am not an attorney, just a regular investor passing along what I was told so you could compare it to what you have been told by your attorney. 

Now if someone chooses to take on mom and pop retail tenants versus strong regional to national tenants then a landlord can have a headache if they do not know what they are doing.It can be natural for those owning SFR to get comfortable with multifamily as you are essentially taking a bunch of houses or units into one or multiple buildings and an easy concept for most to grasp.

If you're looking still looking at class A you should look into areas that are restricting new construction (or where development opportunities are naturally limited).

That is too volatile to give larger regular loans on commercial properties.