You bought this for 720k, then put in 463k, and are selling it at a huge loss for 751k?

Bad location= lose money and sell at a loss after a few years of frustration.  

Hi - are there any scenarios in which mid-term rental income/losses can be considered as active income rather than passive, besides when one has REPS status?

Just like you, she can do RE as a side gig and learn a lot more while she keeps her own nest egg going and her lendability strong with a regular job.You should loop her into a major document with all of the properties and all of the profit and loss and go through them one by one and talk about whether to sell or keep, and also base it on geography for her and your collective choice of management.

This could manifest itself in additional damages and financial losses when they decide they don't want to put up with you any more.Also, Section 8 does require more work setting up, renewing, increasing rent, etc.

A seller not fully informed of these points may have legal basis for initiating a lawsuit against the investor/buyerFrom the buyers perspective any down payment, capital expenditures, etc may be at risk of loss if they can not pay off note IF it is called due.  

I am not sure I've ever seen where the tax writeoffs are different for STRs than they are for MTR's or LTR's in terms of writing losses off against your regular income. 

The PMI gets higher as you step up from 85-90-95% LTC.So even if you can get approved for this, you need to ask yourself are you willing take on potentially years of cashflow loss, for the privilege of owning the property?

Some of our properties that were cash flow negative initially now have the best cash flow thanks to rents going up in these great locations, and very little turnover, vacancy loss or tenant damage, etc. 

Also my advice would be to not think it's a loss if you don't pull out 100% of your funds on the refi.