The ARV is $120,000-$130,000 with rehab costing no more than $15,000.

She's also pushing really hard for no more rent to be paid.

Normally no more than financing (hard money lenders will require an appraisal) and inspection.I maintain that the worst thing to happen to flippers is the "HGTV crowd". 

Assuming for the sake of answering your question, if you paid $40k, you would want to invest no more than $30k to arrive at the market rental rate of $700/month.  

Boom, no more mortgage to pay! 

I would give them no more than 60 days notice of intent to increase rent to $1,200 or whatever you decide. 

It appears that short-term corporate rentals (i.e. at least 30 days, but no more than 3-4 months) tend to have higher returns (principally in terms of monthly cash flow) when compared to traditional long-term residential rentals.

@Allison PanilaIf we shadows have offended,Think but this, and all is mended,That you have but slumber'd hereWhile these visions did appear.And this weak and idle theme,No more yielding but a dream,Gentles, do not reprehend:if you pardon, we will mend:And, as I am an honest Puck,If we have unearned luckNow to 'scape the serpent's tongue,We will make amends ere long;Else the Puck a liar call;So, good night unto you all.Give me your hands, if we be friends,And Robin shall restore amends.1.

You will hear "no' more than "yes". 

Ive done my share of living in foreclosures so no more for meIt should be said, not all strategies work in all areas.