I assume since I have plenty of basis, I would pay no tax as I'm not overdrawing my basis.

Then once you close on the house take out a standard 30 year mortgage to pay off the hard money loan?

The argument was that the buyer will pay their agent directly instead if the seller paying both. 

While the market is stalling a little my wife and I are considering the "Shred Method" to pay off some of these properties faster.

Do you like cash flow and paying less taxes or are you looking for the highest potential returns with a bit more risk?

You do have to pay a fee for this, but if you have any questions on how to do it, feel free to reach out! 

On May 30th we also presented them with a written lease, which they refused to sign.The tenant informed us verbally and through text message that they would pay the rent increase but would be moving at the end of August to low-income housing.

My goal is to pay off bills from the construction, remove my co-singer, and purchase another property out of NYC. - The loan is an FHA at 3.25% Please help before I do something stupid!!! 

Understand if the land is a greenfield site (land that has never been developed) or a brownfield site (land that has had previous development).

If it is affordable just pay to have it fixed and keep the tenant happy.