If it was built in 2004 and you don't need major renovations and you plan to buy and hold, I think you would be fine. 

I explained that my partner would be funding the majority of the down payment, but she said that I can't just accept a transfer of money from her to help fund the down payment.

It depends on your local rules but splitting a parcel can be a major pain and the locality might not even allow it due to zoning or setbacks or lot size restrictions. 

I think you have bigger priorities to worry about if acquiring $10,000 is a major roadblock for you.

I just sold a house last year that we did a major remodel on, I know an extremely good realtor, and I know a foundation guy whose company also does some flips so I am better prepared than many.

I would also say that cash flow wise, I would want to stay below 200K and probably closer to 100K-150K where the majority of the rental demand is in DFW. 

Renovated the park thats about 3 blocks away, and a new shopping plaza is under construction about 4 blocks away is near 3 major freeways and the houses around are all typically rising to the 500,000 plus price range.

And it also applies to any type of real estate you purchase with the intent of holding for productive investment use.  

Major plus.

With a regular, regulated lender neither one is legally possible and wouldn’t meet fed/state banking regulations.The current lender will either give you a discounted pay off, or they won’t.....that is your only solution to refi.The deferred principle makes this sound like a loan Modification done by a major lender.....not sure what a “balloon payoff penalty” is, sounds you are mixing up terminologies.