@Mckinley baggett My standard practice is to wait 6 months to get the cash out refi  per lender seasoning requirements so I could get the unit appraised and take out the ARV vs. only the initial price.

These savings don't include the $300k less in taxes his estate will pay by letting his heirs inherit at the stepped-up basis.   

Nice Michael, phenomenal job on breaking this project down step by step.

The next step after your list is made is to call each one and ask what their minimum mortgage amount is on a non owner occupied loan.

Is this a standard practice?

I think it is important and it will also help you grow as an investor and learn the ins and outs of both product types.I would take the first step as soon as you think you are ready. 

If so, you are practicing real estate without a license and subject to all penalties and/or fines that goes along with that in your state. 

We have a property management company in town and could help you through some different recourse steps:- Make sure to look through the management contract you signed to see what recourse actions have been put in there for this specific situation- Make sure to look at any invoices that were input into your owner statements/portal and see if these checks were made out to actual contractors or were made for legitimate expenses.

In addition to the practical aspects of following a properties profitability, if a property sells, all expenses are tied to the saleable unit and the basis is quickly and accurately available.

@Josh Fernandez When you buy a foreclosed home you still have to go through the traditional closing steps as if you were buying a traditional sale.