It is thier screening process, their requirements to rent, etc. that you should be focused in on to ensure they are doing their due diligence to finding the best possible renters for you.

@Josh Thomas most cities in Metro Detroit got so tired of OOS investors flaunting the rules via LLCs, as you are suggesting, that they now require someone to be liable that lives within 25 miles of the property - usually a person at a PMC.Most duplexes have a side door that both tenants can use to access basement.

You don't need to tell them your address just say if I were to do this does it require a permit? 

Also, we explored the option to do a boundary-line adjustment and compensate the neighbor for it, but he has a grandfathered clause in that allows him to build on the lot without meeting the new city requirements.

This program is specifically designed to help finance the construction, acquisition, or rehabilitation of rental properties with multiple units.To qualify for a USDA multifamily loan, the property must meet certain eligibility requirements.

So there are many good lenders that do no have a license as its not required.

A landlord seeking to evict a tenant must satisfy one of the requirements defined in New Jersey's Anti-Eviction Act.

This would let you satisfy your 1031 exchange requirements but also scratch your conservative itch. 

@Andrew Postell, I pulled it off the GRM site, which may not have updated ratios: "DSCR loans require borrowers to meet a minimum DSCR threshold, typically around 1.25...." https://www.rate.com/resources/what-are-non-qm-loansI spoke with a loan officer who said it may be lower now to reflect the market, so you may be right, but I am awaiting the approval and don't have the final ratio. 

I'm wondering though, if I market them as lease option/rent to own, will a PM show the property, handle paperwork including the option contract and then manage the property or does that require a real estate agent?