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

However, I am self-employed (own an IT company) and have erratic income.

This section is pretty self-explanatory.

If multiple neighbors detected the same thing about these people, how did my property manager miss it and hand them an application in the first place?

Some people submitting an application will give you the phone number of a friend, family member or other person who will lie for them, posing as an employer or a past/present landlord.

Family/friends isn't an option for me, and I don't want to go the self directed IRA route because there are too many benefits I can't give up on (loss of passive loss deduction, can't do work int the rental myself, can't even save on commission as a real estate agent apparently).Thanks for your thoughts.

There are not a great number of books, blogs, or articles that will guide you to be able to handle notes on your own, There are a number of webinars and podcasts that help but a true commitment to note investing requires a little more unconventional application of interest.

@Curran D Bishop check-out On-Site, it's free to landlords they make their money from the tenant's rental applications. 

As a GC, we get notifications when an application is submitted to the Building Dept under our license and then when permits are issued.

Are you self-employed?