I can pull a HELOC on my investment property in KY, pay outright with cash or finance through the installation company.

You then have to stack your financing costs on top of that, as well as reserves for Maintenance and Capex.You could always start off offering the other side of your house as a STR and see how it goes.  

Story is the owners got old moved in with their kids and their kids had their own home and didn't want to be bothered with the house.

I use Buildium and QuickBooks - Buildium for tenant placement, screening, rent collection, etc. and QuickBooks for finances. 

Make sure to do a FHA 203k loan so you can finance most of the renovation and save some money for anything that may come up, and furniture. 

When I've met the dog in person, it's very calm and nice; it just seems to bark a lot when its owner is not home.

While interest rates might be higher, they can offer quicker access to capital.Seller Financing Adjustments:Negotiate with the seller to see if they are willing to adjust terms slightly.

Unfortunately,  that’s not accurate and you can get an owner occupied STR permit in any zoning.  

How did you finance this deal?

Is it a violation of forum rules to discuss the possibility of partnering up with like-minded property owners to form a privately owned property management company?