What other documents would we need in order to protect our lenders and ourselves?

One way landlords can protect themselves is always send a 1099 when required.

.#5  They may be able to provide location expertise and inside knowledge of the area for you....the good, the bad, the ugly.   

Understand that I’m personally liable for the mortgage but want the protection of LLC from property liability. 

This enactment protects the tenant anyway.

Other matters, like your asset protection or business structuring, can be done with somebody else.

There is specific verbiage HUD requires in the purchase contract to protect the borrower and disclose some of the 203k contingencies to the seller.

If your looking for protection, you can use a series LLC if your state allows.

As a note owner, Ive had to do that to protect my 1st lien position. 

Maybe he is referring to using an FHA loan to purchase the property but that is only if you are going to live there... you can then move and use it as a rental but you can't purchase an investment property with an FHA loan (i am pretty sure... i am sure someone will fact check me on that).I would always purchase a property in the name of an LLC for the liability protection then just find a local bank who is willing to give you a loan for it.