There are significant details that I'm choosing to leave out regarding rent payments and balance left for the owner as you terminated the lease early. 

All interest payments flow back to the Roth IRA and HSA tax-free. 

At the end of the day, your servicer is there to keep your loan compliant and to process and apply payments.

The down payment is 25% down for single family residences and 30% down for 2-4 units.

It depends on what the terms of your mortgage are.Pros-with no mortgage, you have higher cash flow.Cons-if you plan on buying more properties, you are better off saving the money for a down payment for your next place.The big questions are: can you get higher than 7% return if you invest that money elsewhere? 

Looks like Paramount is under Federal investigation for having failed to make agreed payments. 

I would offer it on a land contract to someone wanting to live there for around 1500 and small down payment or sub2 with a large down payment and monthly that would cover PITI.

Since your goal is lowering monthly payments for better cash flow, it might be worth focusing on reducing expenses elsewhere or exploring other investment strategies.

Currently, we are learning more about investing while we save enough capital for a down payment for our first rental property.

Do they have a way out of the balloon payment?