You can do DSCR loans or Hard money loans, where they only focus on how well the subject property performs in terms of the rental aspects or the ARV aka after repair value.

Does anyone have any experience with raising private money for STRs?  

Providing advice without understanding the full scope of your business and its operational plans could result in inaccurate guidance.As a hard money lender, I provide financing options for both DSCR and fix-and-flip loans.

It seems PMs don't make a ton of money for all that they do and their incentives don't always line up with investor's incentives (i.e. getting paid more for turnover in terms of tenants when I'd prefer no turnover or vacancy).Sorry for the long intro, but having said that, I have a few questions...   

I'm trying to understand how house hacking is so profitable, putting down so little money, 3.5% or 5% would make for a hefty mortgage payment wouldn't it?

Do I put more money into these deals, or do I accept a dilution of my shares and put my money elsewhere?

It’s like moving money from your checking account to your savings account. 

The loan gets paid off first and any money left over is you “equity” and comes to you. 

Even without the cheap money and the cash flow, I always make the rental as sound and maintenance-free as possible before occupancy.