If we were to put it on the market again, I'd estimate at LEAST $10k to get it market ready for new carpets, appliances, paint.Knowing the condition I rented to him before, currently it wasn't anything I could make a case that wasn't "normal wear and tear".If I don't take this into account, I'm over-shooting for a client that is underinvesting ........and there will be negative return on his investment home.

Last I heard, 21% was a better return than 15%.  

I have an account around that size with Lending Club and am seeing 9-12% year over year returns.

It's rented now at $1550 as well, on a $540 mortgage payment (5.85% 5/20 ARM.)I estimate a net return of $5K yearly on each property after expenses (thanks, BP calculator!)

I have an offer from a lender that is currently asking for a 12% fee and in return they will provide my business with 60k in Funding. 

It would be easily rentable2.

Perhaps there is a misunderstanding with who's name the mortgage is in but this can be easily fixed on your books.

@Gary MontgomeryYour first year is going to be the most difficult because you will not have any tax returns as a SE investor, which is heavily weighted for bank underwriting. 

Here you can turn one year's tax return (or one year's contribution to a self-directed IRA) into a down payment on a new rental property. 

You can do a quick check on google, and just search "tenant law in MD" and it should give you the law pretty easily.