On a 1k/month mortgage that nets a profit of about $62/month which can be used as an additional principle payment. 

This is obviously a fallacy; which is why experience and general real estate knowledge of real estate principles is SO IMPORTANT.  

With regard to giving a tenant leeway, its very short sighted to evict a tenant with a VERY strong track record for a VERY small shortfall one month, especially when they have been communicative and given you what sounds like a reasonable explanation as to what is going on.

and would ideally like to set my sights higher so that within 10 years my husband can leave his teaching job and work with me in managing our properties.

@Dar Baruchim you should see your first few investment properties and find experts to assist you.Buying sight unseen OOS is not recommended for newbies.

I realize that I made mistakes, in hind-sight, in working with him.

My wife and I are just starting our journey in real estate investing and have set our sights on the vibrant market of Houston.

The beauty with the seller paid is that the money goes into an escrow account and if you refi or sell during the buy down period, the left over funds go towards the principle, so it’s not lost like if you were to buy down the rate with points and then sold/refi in the next few years.Hope that makes sense but let me know if there’s any other considerations or something I misunderstood and we can continue brainstorming!

Work hard, take accountability, accept coaching, do the best job job you can regardless of whose watching, invest in yourself with knowledge and self worth, spend less than you make, stay out of bad debt, keep your hands with calluses, give cheerfully both time and money, count your blessing being born in America, be the person who will take the risk and don’t be ashamed whether you strike out  or most definitely hit a home run.many more principles but values trump degrees any day of week 

Check out the link above, but the main principle of house hacking is as follows:House hacking refers to ways to generate income from your home.