It's similar to another park I've done well with the last year.

U need to flip the return  75% to the money and 25% to you if have any hope of finding someone to do this that is not friends and family.. 10 to 15% is way to little for the risk of being a gap funder.. if the project does not work gap funder is the one who loses money..

Recommend that she contact the state's rental assistance program, the victims' assistance program, and make other arrangements to pay or vacation within three days to find more suitable housing - like Section 8.Run your business - or risk having the tenant ruin it.

Taking the risk of a tenant while you yourself are renting is not optimal in my opinion.

It  depends on your risk tolerance and what other assets you’d like to protect.

Is it worth it to go through the proper process with the city and run the risk of a huge expense to make this a 3rd unit? 

Well...they can, but they would be lying or just plain wrong!

Here are some thoughts on your choices:401k Loan: This can be a good option since you're borrowing from yourself, but it comes with repayment risk, especially if you leave your job.

Auction buying is a risk just is..

Research the options available, compare their benefits and risks, and decide which approach aligns best with your goals and preferences.House hacking is a great start.