I’m interested in their perspective on what is needed to properly repair the situation.

This money is taken out of a HELOC.2) Get Delayed Financing at 70% purchase + rehab = getting 70% of 70k, or $49k back. 3) Pay that $49k back to the HELOC to vastly reduce that balance.

My opinion is unless you desire to speculate on the Jersey City Housing market, and find that the ~400 loss per month is worth it to have skin in the game, then I would sell.Based on the wording of your post is sounds like you prefer stable cash-flow properties to speculating on the market, but both are fair strategies when properly applied

Am thinking of going to auctions but am aware that proper due diligence is critical.

If you are going to be in the hotel business, hire a cleaning person to properly clean the unit.

Just seems dangerous with fair housing laws, as really all I can tell from your photo is what race you are.The only time I'd consider a family vs non-family is if the other offer was similar but from some out of state investor group or something, and even then it would be the weight of a single hair on those balance scales. 

I'm ready to start looking at properties and identifying a contractor/s I can work with, what type of insurance will I need to make sure my business is properly covered and does that have to be renewed/added to each house I flip or is there some sort of umbrella policy that I can add and remove properties as my business progresses?

It's a nice balance of firm but still approachable.

It sounds like you've already taken the proper first steps, which are to learn as much as you can and then to define your investing strategy.Your dollar will certainly go further in the Phoenix metro area than it will in Orange County, and there are numerous 2-4 unit multi-family properties in Phoenix, Mesa, and other suburbs that are within your budget. 

As a borrower myself here in Southern CA, I have done at least 40 fractionalized notes with lenders and navigating through this process as a lender without experience (not sure what your experience is since it was not mentioned) can also be dangerous without the proper guidance.As David mentioned, $110k in CA is not likely enough to get you in first position without fractionalization.