This strategy often will cover most, if not all of the actual mortgage, while you fix up the other half or life there (in your case school). 

You could frame it as a way for them to get all the cash up front and not have to worry about maintenance or expenses on the property anymore.

Pulled all the carpet up.

Rents go up, houses appreciate, your indebtedness decreases. 

Why does interest rates going up have any impact on your investment?  

What's up Edwin, welcome to BP and welcome to the Sacramento investor community! 

When a tenant moves out, transfer the deposit back to Checking so it's ready to apply towards expenses or refund the Tenant.If you end up with excess funds in the Checking account, I recommend you transfer it to a third account designated explicitly for future investments.

I was thinking of doing some creative finance: Maybe offering to take all three properties off of their hands with a lease to own, so I don't tie up all my money.

I am looking to learn more about the Tri-cities area in Washington and possibly start up a relationship with a realtor that focuses on working with investors.

This is a great forum, but don't be surprised when Joe from Ohio, who read a Carlton Sheets book in 1988, tells you how to set up a depreciation schedule for your portfolio only to have it bite you in the butt simply because you didn't want to pay your CPA.