In a better market you might be able to use those things to get a better deal on commercial insurance but in the current market there won't be flexibility.On personal policies/1-4 unit rental dwelling policies there won't be any flexibility whatsoever unless it's something the company already has built into their guidelines/pricing.

These are all private so someone had to include them, and then that person can pursue you for failure to comply.

Personally I feel he earned it that’s his money.

This is a lender and personal question.Lenders look at your monthly Debt-to-Income Ratio.

Recommendation letters would be fine as well, but personally, I think talking to them over the phone is more ideal as it's easier to get answers and just a better understanding of the tenant. 

Myself, significant other, and my close friend/business partner have been renovating his personal residence for the past few months with the intention of renting it soon.

Then visit the lender website and see if the have an REO section or try to find a person's name.

Born and raised in Lake Arrowhead and personally own several STRs in Arrowhead, and own an insurance business where we specialize in hard to insure homes and STRs in the mountains!

Basic recommendations- Deed of Trust-Personal Guarantee-Promissory note-JV agreement (to protect the lender from violating usury laws)-clear late fee schedule, cure period agreement-cross collateral if the subject property doesn't safely cover you with enough equity

I would hire another person that has construction and real estate background.Take your  annual Salary.