If not paid, late fee is applied.

Please see more below:Solo 401k vs Self-directed IRA:A Solo 401k has several advantages as compared to a Self-Directed IRA including the following which specifically apply to your situation:Unlike a Self-directed IRA, you can have the account for the Solo 401k at a bank or brokerage that does not charge maintenance fees and where you will have checkbook control.Unlike a Self-directed IRA, if you use leverage (which must be non-recourse financing in either case) to acquire real estate with your Solo 401k the income will not be subject to Unrelated Debt Finance Income taxGeneral Considerations Re Investing Retirement Funds in Real Estate:1.

Can't do the capital gains exclusion as primary, as I noted "They've been there 4 years" so I'm past the 2/5 year rule, which would only apply if it was a rental for 3 years.

If what I read in the above article is accurate it would seem that is impossible in my state of kentucky, would that apply even if I'm using an RMLO, attorneys, etc. 

Territory, many of the same rules of purchasing in the states apply here.  

THIS PARAGRAPH SHALL PERMIT RECOVERY OF ONLY ONE HOUSING ACCOMMODATION AND SHALL NOT APPLY TO A HOUSING ACCOMMODATION OCCUPIED BY A TENANT WHO IS SIXTY-TWO YEARS OF AGE OR OLDER OR WHO IS A DISABLED PERSON;"  So you can evict one tenant to allow a family member to live in the property. 

I would say rent owed is Option 1 and you can apply the escrowed amount towards it as a way to remedy the debt. 

Now, you might already have NONE of the items that we face as investors if you have already owned these properties for a while and are not looking to do the BRRRRR method so maybe none of the questions below would apply to you but I wrote the questions below to help people work with good, investor friendly lenders.  

I guess the lesson here is it that also applies to renting out rooms.

Recently applied for the remote workers 10k bonus to move to Tulsa, OK so we will see how that goes.