Now I spend 5 years hoping they make their payments and somehow refinance to pay off the balloon. 

Your tenants can only continue paying similar rents if they remain employed at similar wages.

If you think you can manage a mortgage, taxes, insurance and the upkeep of a home while paying your student loans then buying is not  bad idea but if you think you will overstretch yourself renting is nto bad either.

One year ago, I was hired to help a landlord whose tenant had stopped paying.

I understand that I can use the principle from my Roth IRA’s but for the most part that money is locked away without paying penalties to access it.

But you'll have to either manage it yourself and develop a really good skill set in that or get a smaller company that doesn't have too many properties to manage who has a high skill set management for you, but then you need to pay for that.

How much in education did you pay to get Tyler Deveraux and Ryan Wooley listed as advisors on your website?

You will report worldwide income on your federal and Kansas tax returns.You will also include the MO activity on your KS return.Your MO return will only include the acitivity within that state, which in this case, is the rental property.In the future, if you have income in MO(either through the sale of the property or through rental income), you will pay tax to MO but KS will give you a credit for any taxes you pay to MO.best of luck

If it were me, I would pay her her half of the equity and do a refinance.

Happy to let this property do what rental property does best- pay for itself.