I have flipped new homes and townhomes but phased out raising a family and now am focused on utilizing my skills which are building, selling, expanding a circle of influence to focus my effort on the above.

Right, but to get an ARV close to $130k, you'll probably need rent to be close to $1,300 unless you can sell it to a retail buyer, which could be a big risk on its own. 

House gets foreclosed on when a borrower is not paying its debt obligations - typically its mortgage.buying foreclosures is not for the faint of heart as you have no idea of the interior of these properties lastly while it can be beneficial also realize if there are a lot in an area those homes are the new comps when trying to sell so it lowers home values in an area 

They do not take into consideration the revenue from the STR business as part of the selling price.So if comps say the duplex is worth 500k, then it is worth 500k.

It will make the loans more valuable if you ever decide to sell them and decreases the chances of default. 

What cap rate is the selling asking?

I've seen 100-year old 1300sf houses in Phoenix in the historical district sell for more than new builds twice their size in the suburbs.

On the bright side I think many of the scammers that sell you on owning 1000 units are being wiped away and maybe that kind of an opportunity will come back. 

How could I force her to sell.

Its easy to sell high yield deals.Looks like the rates they advertise are a good bit higher than other options ive found.