My plan is to provide the lender with the updated insurance policy before cancelling the seller’s existing policy, ensuring there is no lapse in coverage.

They are way too guest centric and often leave owners hanging.VRBO and AirBNB should be all you use in addition to looking at direct booking as well.You can rent an ozone machine which should take care of the smoke smell.

This way, I can maintain control over the access to my properties and ensure that everything runs smoothly.

Quote from @Andy Chen: Hi all, I’d like your advice on how to structure a potential deal.A friend of mine owns a property outright that still has plenty of space for additional development.

I'll focus my answer in digital property management vs local property management.In recent year it has been an overflowing of digital property management companies, many of which are not making any many and constantly investing in customer acquisition, that is the main reason that you see so low coat on their offering.If you go to stablish digital property management like belong home you will see that prices are similar than a local property management and they make you save many offering you additional services at no cost.You have to evaluate what would it be the additional work that you will have to do to get at the same level than the local PM.You have to analyze this as a business owner like any other services that you will buy from a service provider. 

Luckily we always build in a contingency, but we like to have that left at the end . . . at least we have that expense addition covered.  

However if the borrower will live in the property, you MUST underwrite the borrower to ensure they have the ability to repay.

Additionally, others are targeting the same lists, so finding an exclusive, highly motivated list is difficult.

So, I do agree with hedging your bets and serving a notice to pay or quit.The issue with them not paying rent and you using the security deposit is that they have zero incentive to clean the unit and if they damage it, you have no additional funds.If it were me, I'd serve them an eviction notice and then mark them as owing on a credit reporting site(I use Front Lobby).

In many cases, pairing your property LLCs with a holding company in a state like WY, DE, or NV can give you an additional layer of protection.In my experience, the cleanest structure is having each property in its own LLC—at minimum, one LLC per state where you hold rentals.