My gut response is that you're in danger of being a general contractor.  

I will send a letter to the tenants to introduce the LLC/myself, with new address for checks, phone for problems, etc.Beyond that, I'm in new territory.

The added bonus is that the 1031 can be used to reinvest in any geographical location in the US or US territories.  

No, you don't have to and you are in danger of her "training" you instead of vice versa.

I almost fell in that trap and it's dangerous. 

 :)   #1 fix the house so its not dangerous, #2 screen for sane tenenants then treat them great so they LIKE you!!

It being easy to get into coupled with the fact that's it's not easy to do makes wholesaling a dangerous place to be for a lot of people.I've been on BP for a while now (maybe 4 years) and I've read countless posts titled "How do I get into real estate with no money?"

But you've really gotta partner with somebody that can steer you clear of danger.

This is retail territory, so you're up against either FSBO or Realtor.If you have an investor-friendly real estate agent (preferably one you already know, or has been recommended to you), give them the property address, ask for the current comps, take them to a nice lunch, discuss strategy, and possible listing if the numbers work for that. 

I thought the belt tightening 2-3 of years ago - when regulations returned to the "must qualify at 5-year benchmark rate, 25-yr amortization" from the "if you have a pulse and want a 40-yr amortization" - that this programme had been eliminated.I wonder how many (if any) lenders are offering this programme.Regardless, while it may be useful (though with the premium charged, I have doubts), it can also very dangerous.