When they approached me about this whole deal, they knew that it would be a slim chance but they wanted to ask anyway.

You might consider charging a fee, even hourly, for assistance and give some to the broker.You can certainly work investors, but they need to be able to buy, not just one deal, but 20, the thing about working with good investors is that they are repeat business, but if they have to do lease options every time of get seller financing, they are not investors for a Realtor to build a business on, those deals are slim and like your broker was saying, get something for nothing, wasting your time submitting low ball offers.

I agree with @Christopher Brainard on the deal looking slim.

Robert Herrera I agree it seems very slim that you would get in trouble for renting the first year of a FHA loan, but it is still against the contract a person signs.

Just remember to approach these people kindly and think of how you can add value to them, otherwise your odds of succeeding with them is slim to none.Just think about how you'd like to be approached by someone if you were in their shoes

If you are working on too slim of margins, then closing costs can eat up your cash-out. 

Two options for ya.... take the slim/non-existent cashflow and enjoy the rent pay down, tax benefits and equity.

@Michael Duke i understand what you mean when you says margins are slim in the treasure valley. 

Now  The likelihood of me ever having 100 million net worth is slim to none, but I guarantee you it’s 1000 times higher for me to get there then the person working 40 plus hours a week and buying their lottery tickets.   

They are taking the majority of risk upfront and often times, for a slim profit.