What lender is saying is that when they do credit check it shows up that EACH of us are responsible for the ENTIRE 600K. 

Those are called credit reports (yes...being smart here) and if you have a credit report on a borrower, for a property you are interested in, you didn't obtain it legally.

Unfortunately, when the put it into monthly fees, they draw on their credit line, so everyone wind up paying interest on  top.

In most cases people get a large up-front deduction in a year they typically don't have much income or they have such a large deduction they lose all benefits of other tax attributes (itemized deductions, child tax credits, etc). 

Would each house need its own bank account, security deposit account, and credit card in this setup?

I have a little over $3,000 saved with excellent credit - are there many loan options for people in my situation?

Should landlord have background, credit check for section 8 applicants?

You will usually spend more than building the property new from scratch.Having said that, let me suggest you look into a couple possibilities.1) Historic tax credits - you can often make a project that makes no sense financially work by applying for tax credits so you should look into that.2) Why do the windows need replaced and can you do it over time?

She is not on the mortgage and her credit was never pulled with mine we got married 4 months after I purchased my property with fha. 

Looking to explore options for owner occupant lenders outside the conventional limits that borrow in Chicago to high credit/income individuals with under 20% down.