And I'm really not even sure how to verify their income because I'm not sure how much of the rent they are responsible for yet.My question is, let's say I have a perfectly qualified non section 8 Applicant make it through the entire process and submit a deposit to hold before the section 8 applicant gets all the appropriate documentation submitted. 

We considered using the cash out for buying a new multi unit property and using the greater income from that one to pay the remainder on this house  monthly but obviously that's not a great idea.  

To minimize taxes, consider the following strategies:1031 Exchange Before Dissolution – The corporation could complete a like-kind exchange, allowing investors to roll their ownership into individual properties while deferring capital gains tax.

At least now your tax basis is $220k ;-)  What was the extent of the repairs?

Traditional IRA withdrawals are taxed as ordinary income, with a 10% penalty if under 59½, potentially pushing you into a higher tax bracket.

Join Dallas REIA, BiggerPockets forums, and local meetups to network with tax strategists and title companies who can streamline your deals.

All the markets you mention have possibilities I expect.Look at job growth, population growth, wage growth, average income.   

Assuming your debt is SUPER cheap and only costs you 12% you’ll save $22,800 TAX FREE  So the combination is saving $60k at 12% (or more) is $7,200/yr and $130k in the bank at only 4.5% is another $5,850/yr  so you’re over $13k GUARANTEED instead of a chance to make $7,200 before taxes  

They have solid lease agreements designed to protect you, your income, and your property.Property Maintenance & Repairs: They have a network of vetted, licensed, insured contractors that can respond quickly and do the job right the first time.Minimizing Vacancy & Maximizing Occupancy: Their marketing reduces vacancy time.

Is $107k your true net, or do you have any other expenses (mortgage, taxes, lodging taxes and fees, insurance, utilities, landscaping, WiFi, etc.)?