Completely renovated the property and raised the rents from $850-900 per side to $1400 per side.

Your first rental property, if it is a good investment does Not raise your DTI.  

I just used my VA loan to do a cash-out refinance of my primary residence to raise capital to invest with. 

You could drop the price 5-10k, and maybe you'll get a few bites, or you can raise the commission one percent, and watch them hustle for a bigger paycheck, saving YOU time and money.

If you do not have any capital up front or the ability to raise capital, then perhaps wholesaling would be a better option to start with.  

The 16 unit was listed at 635k and we got it at 540k because we negotiated seller-financing (5yr term/30yr am with option at Year 5 to extend another 5 yrs) The seller required us to bring 120k down, which we raised as private loans (secured by contractual personal notes) from friends and family, and two of those 0% interest for 12 and 18 months credit card check offers totaling 20k (which we have mostly paid off in this first year).

The 16 unit was listed at 635k and we got it at 540k because we negotiated seller-financing (5yr term/30yr am with option at Year 5 to extend another 5 yrs) The seller required us to bring 120k down, which we raised as private loans (secured by contractual personal notes) from friends and family, and two of those 0% interest for 12 and 18 months credit card check offers totaling 20k (which we have mostly paid off in this first year).

This always raises a red flag.

Assuming the condition of the unit allows, am I allowed to raise more than 8% (5% +2 ~ 3% index) and straight to market rent?

My Name is Daniel Madrigal and I was born and raised in Chicago.