I am from Iowa so our goal would be to use it in the winter months (dec,jan,fab) and try and break even off the income from the remaining months. 

Seller financing: Note for $1,350,000.00  - 7% amortized over 30 years with balloon payment after 7 years, interest only. ( I am trying to get the first year at 6% to stabilize then go to 7% remaining 6 years)Property Condition: Above average.

I would consider selling one of the properties, paying off the debt, creating a reserve for your remaining investment, and ensuring you are 100% financially stable before you invest again.

Long story short, it has been over a year and the project remained incomplete and he walked away with the money.

What are some cities that might provide cash flow, but remain affordable?

I can't leverage my remaining VA loan entitlement to fund this because it is a 'secondary/vacation' home.

On your tax return you would report the proceeds, subtract costs and proceeds paid to seller, then the remaining profit would be your flat fee.

If you feel the need to explain why you hit the "reject" button, you could add to any of those: We are closing this leasing process by rejecting all remaining applications in the queue. 

I have a 5 bed/3.5 bath brick home in Madison, AL. 4100 sqft on a VA loan at 6% with a remaining balance of $404,000 roughly; 28.5 years left.

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