What happens if the tenant takes an extra three days to move out?

The reality is the opposite - if it's not in writing then the PMC doesn't have to provide the service or can charge extra for it!

The property is 3B1B and I plan to add an extra bathroom it 3B2B.

0 Chance.Cmon, pay for insurance or just don't own real estate.Trying to gain an extra 2-3% ROI and risk your entire principal is just stupid.Don't be cheap, get insurance.

On a fixed mortgage, i could pay extra payments (or a one time lump sum payment) and apply it towards principal.

Most people who buy 2+1 and think they can use the third and get busted on that, end up renting the bonus unit to the top or bottom unit as extra space, but that is a loss on what would be unit rent by more than half.

As mentioned if the holding company is not solely holding or owning assets together funneling monies as a loan would further complicate if there is a default but also cause you to file extra tax returns = $...Yes you are taxed on interest income or any money that you make, does not matter how you structure it, what comes into play is not how much your taxed but how much you pay someone to figure out for you how much you need to pay and each layer is an added cost. 

Single Room Occupancy (SRO) or PadSplit / CoLiving are able to make a ton of income, especially if you modify the house with a couple extra bedrooms. 

Consider the extra expense a capital contribution to the equity provided these are in good locations. 

It's easy to obtain, costs very little, and doesn't require extra, on-going effort to maintain.