@Christian Reyes Be careful.

What percentage do management companies traditionally charge for management?  

From that, financing our first deal with traditional loan would not work ( and it did not as I have tried mortgage brokers and a number of them are very specific on W2 requirements).

Third, my primary debt (aside from mortgages) is student loans, which is driving up my DTI to the point where it might preclude obtaining a traditional mortgage.  

I'm not sure if LLCs can get a traditional 30 year fixed mortgage.

If you had used a more "traditional" 25% down mortgage to buy in the Midwest town, would that have worked?

If he bought a single family home and you cosigned, then you would still be elgibile for a traditional 3.5% down payment. 

If you have a method of paying that HELOC back then that is the less expensive method than a traditional mortgage.  

Having your license also makes it so much easier to find, see, and analyze properties since you have access to the MLS for pulling comps and getting showing instructions.You may also find that you actually do like working as a realtor on more "traditional" transactions and helping people (both other investors and retail home buyers) buy and sell homes or manage properties, and it can be a great alternative income stream.

We are currently using traditional financing with 20% down.Unit 1 - rent = $495Unit 2 - rent = $650Total income = $1145Cap rate (based on our offer) is 16.4%Cap rate (based on asking price) is still 14% ROI = 34.41%Picture below is from Bigger Pockets calculator:Picture number 2 below is our own calculator at full asking price purchase: if we were to increase rent on the smaller unit our cash flow will increase (easy added value).After walking through the property twice we see no real updates that are needed. ($0 estimated repair costs)We are waiting to hear back from the agent if we need to counter offer.