-The approval means of conventional and even home equity loans is exhaustive and burdensome.

Seller might claim that the contract wasn’t fair and equitable to begin with, or use stalling tactics, or they might say they need to move into the property because they are getting divorced/ lost their job/ need to move their ailing mother into the property, etc. and anything along those lines might make a judge more sympathetic to them than an investor buyer looking to turn the property into an STR. 

. - RTO agreement should not give the buyer an equitable interest which would require something more like a foreclosure than an eviction. 

Once again, the loss of the compounding factor by concentrating on my personal home rather than an investment was significant. 

Even if they receive the $500,000 up front, in a little over 2 years, that money is exhausted if they use it to pay rent.

Longer than an STR stay, shorter than an annual lease.Using that definition I don't have a ton of MTR experience so maybe someone else will chime in.

I'd recommend treating it like a formal business relationship through an LLC and an operating agreement that addresses the contributions of cash and services (services that are quantifiable in the operating agreement) as well as any disputes, how you treat/report taxes, what happens if the asset (the property) needs more capital to fix a roof or call a plumber, how to make day to day decisions, the ability to open up a bank account that is owned by the LLC rather than an account owned by you or your sister individually, and gives you a pathway to easier inheritance so you can leave your 50% (or whatever interest you have) to your estate.

This is not an exhaustive list of what should be included; rather, some of the main elements. 2.

An S-Corp will increase your tax prep fees and turn passive income into active income which means that you will pay more taxes, not less.If you are a real estate agent or wholesaler with active income a solo 401k is a better tax saving option than an S-corp in my opinion. 

I tend to agree with @Bill B. on his comments related to the flexibility of commercial lending versus leveraging your existing assets.You just need to look at your entire portfolio, determine the amount of leverage you are comfortable with (for me I try to stay below 50% LTV for my portfolio, but that is more conservative than most others who are starting out).If you still have equity to tap into on properties that could qualify for 30 year financing, I would go that route first and only tap into the commercial building's equity after exhausting all traditional residential lending avenues.The transfer from family will certainly present some unique challenges for tax reporting, I am happy to be a resource for you there.