Monster PC Advancement

Ok, I'm planning on playing with an Incubus Paladin. The GM said it's ok, the party said it's ok, and so I'm going for it, but a few questions came up regarding playing as a monster.

First, the rules state that I should take the CR for the monster and add a number of class levels until it reaches the level of the party. Since the party's level 8, an appropriate Incubus (CR 6) should have 2 levels of Paladin, right?

But is it really balanced? The incubus, even though being CR 6, has 8 Outsider RHD, which means BBA+8, among other things. Add 2 levels of paladin and he'll have BBA+10, 2 higher than what the characters on the party can achieve. That's... weird.

Also, the rules state that when reaching three levels, you should get another level, which would increase BBA, saves and skills even further. The character would be way ahead of the party on those areas, it seems...

Lastly, how should I treat him regarding static level bonuses such as feats and ability score increases? With him being an Incubus (CR 6, 8 RHD) Paladin 2 (2 HD), should I treat him as an 8th level character or a 10th level character?

This is so weird it makes my mind boggle... help me out here, please.

I've had some experience having run 3 campaigns with "Monster" PCs.
So this is what I would recommend from my experience.

Yes, you start of with 2 levels of Paladin

No, it's not balanced. This is PF which is descended from 3.5. Nothing "balanced" but you can with some fudging do ok. Basically as you get higher the level been behind on getting the higher level abilities starts to bite. At what point, if ever this balances depends on a heap of factors. But like I said we all know the game is not inherently balanced and unless you are playing cookie cutter characters there is a limit to what can be done about this.

Actually when you are halfway between your 2nd and 3rd Class levels you get a Bonus Class level (remember to distinguish this as a Bonus class level. It avoids confusion later).
The rules recommend you do this at 5 1/2 class levels and at 8 1/2 (1 Bonus Class level for every 2 CR).
You only do that where the Monsters advantage is only really Stats spread over a significant amount of racial levels. In the case of the Incubus you have powerful Spell-like abilities. 1 Bonus Class level per 3 CR is plenty. i.e.

Re: Skill ranks etcetera. Everything that refers in the rules to limits due to HD replace with "Character level". Character Level is your Monster CR + Class levels (not including Bonus Class levels). This avoids a number of power breaks I've run across. Note re: BAB. For purpose of prereqs that refer to BAB I would recommend you consider your BAB beyond your Character level is not counted i.e. you need to be Character level 11 before you qualify for feats that require BAB 11+ despite your BAB reaching 11+ sooner.

Feats are based on HD. So yes this does give you an edge.
If you play with Retraining I would recommend you start with the feats in the Monster Stat Block. If you don't play with Retraining then allow them to be re-chosen at start (exception racial Bonus feat. They are what they are. Not important in the case of the Incubus, but just saying).
Stat increase I would recommend basing on Character Level. So you would have two to assign at start and get your 3rd when everyone else does.

Regarding been targeted by spells that do stuff based on HD. I'd recommend that you count as Character level rather than HD for this unless the GM wants to use the disparity for plot effects. If he does he should go back and forth as required for the plot. You the player knows that you count as at least your character level but in some circumstances you might get to count you full HD. Yes this is fudging but Monster PCs require some fudging. If both you and your GM understand this from the start things will work better.

Remember as a Outsider unlike other PC's Death for you is far more likely to be a career ending injury. And watch out for Dismissal. If you fail your save it can REALLY suck.

Hope this helps.

Thanks for your answer, it's very helpful.

Although I still didn't understand the skills and BAB part. Could you elaborate?

Skills -
Normal PC can have as many ranks in a skill as they have HD.
With a Monster PC this starts to have problems. Both in early access to feats and simply in the level of skills you can get.
So instead you limit the ranks to your Character level. So you have the same maximum ranks in a skill as the rest of your party.

BAB is similar.
I haven't had monster PC's with BAB greater than their character level so I don't know if the actual super high BAB is a problem for combat.
But I've enough experience to know that early access to feats will probably be a problem.

For example your starting character has a BAB of 10 at 8th level.
When 1/2 way to lev 9 you'll get you 1st Bonus level increasing you BAB to 11 which is the prereq for some feats.
For the purpose of getting feats (or entry into Prestige Classes etecetera) you only count your BAB as 8 - your character level.