So all your contracts are good for pursuing lawsuits and collections later, but a huge headache and expense now, with essentially no recourse to actually recover your losses and judgement. 

The downfall to this is that the overall market rate for rentals is essentially capped at the rate of which DoD pays service members for housing here (most single family rentals are in the $800-$1200 range)With this being an active duty base, deployments are going to happen; however, the vast majority of soldiers living in off post housing receive their housing allowance due to being married or with dependents, most of which remain in the area and paying rent while the service member is deployed. 

I'm sure what FHA will ask you to have in reserve but for your first investment property you want to make you have a safety net.

IMO Your safety first over profit you're living there so don't wait and give him his formal walking papers.

Honestly id refuse to show houses in some areas based on my safety alone forget about what the commission would be.

I think using the word "fool" is a bit strong, as I am taking it that you're essentially calling the poster (or me?)

This is for their safety and that of their family!!!

If after 6 months the property appraises for ~$165K as estimated, I could get a loan of ~$123K - ~$93K ($98K- $5K reinstatement) owed to retire original loan, leaving ~$30K cash out which is essentially getting cash invested back and still holding the asset.

Cut your teeth on this first place for a while so you can really get a feel for it and some experience while having a good margin of safety if you have to sell.

Security is essential - these places get broken into quite often.Your tenant, if not already licensed, will have to go through an extensive background check that also requires site visits to ensure compliance before they even get started.