You wouldn't be able to use another FHA loan to buy a second property while you had an outstanding FHA loan so you might consider refinancing. 

If so the money should cover most of the money outstanding of the 15k. 

Monthly pmt is 1.5% of outstanding balance.

I would inquire on the HOA to see if they have outstanding assessments that could be a problem.

Again, the agreement was between the bank and her... not me.If the land owner wants to receive the tax deduction, then they should refinance the outstanding balance and have the loan in their name.

I plan to make an offer of $265k (I have a few outstanding questions for the seller first that I will need answered). 

I’d like to pull out a HELOC on my property to pay down some outstanding debt and perhaps close my first rental deal.

Check with your attorney on how to proceed.In my mind... and perhaps the borrow may be thinking the same thing... if you're in Ohio and they are in Alaska... how much money are you going to spend to make the situation right when the outstanding balance is at $12k? 

I have been lucky enough to be a limited partner in a 250+ multifamily in Houston for 5 years now which has produced outstanding returns so I felt why not get involved more directly.

Divide it by 12 then that's a monthly income of $610.Cash Flow: $610 (income) - $466 (expenses) = $144Cash on Cash would be: $1,728 / $29,922  = 5.70% It's not outstanding but at least, it's not negative.Another option is just to sell it and start over (now at least, am better equipped with this experience and not make the same mistake).Any other advice for me?