House hacking will also give you some personal "property management" experience.

Would our personal mortgages count against us for a cash out refinance?

Kyle, you are correct, you should not be responsible, but the fact is MN law requires you to pay unless you can show the bed bugs are a result of willful, malicious, or irresponsible conduct of the tenant or a person visiting the tenant, which is nearly impossible to prove. 

House hacking will also give you some personal "property management" experience.

STR you personally can enjoy the property too2.

Be careful calling multiple lenders because loan officers are trained to get you into an application and pull credit.

If you're asking for free advice from a stranger on the internet, I'd encourage you to find a different STR market unless you want to have a place in Kissimmee for personal use.

I personally wouldn't charge for any of that if they left the unit in good shape. 

Personally I feel he earned it that’s his money.

And, if you find that person on the right day, you can make a deal that works for both.