I know people do long distance STR, but A) I bet there are lots of restrictions against those in Hawaii condos, and B) long distance would not be my preferred way to start doing STR....not by a long shot.If you can't qualify, find out why you can't qualify. 

You could be a pain and it could reflect poorly on me.

However, he has very poor credit and owes a fair amount of back taxes to the IRS from a little over 8 years ago. 

REI is all about taking risks, and since you only have enough capital to try out one strategy right now (perfectly normal for someone starting out - no, you're not behind the curve) then I would start with your safest bet that is going to make you more profitable in the long run, either with knowledge or cash flow... ideally both!

A few years ago I would have said convert it to a rental, but it's not the sure bet it used to be when 25% of our tenants are refusing to pay rent. 

My fiancé and I were on a walk and noticed the house in pretty poor shape.

I bet you can.

Easy to rent because poor people need a place to live.

Your best bet would be to link up with some wholesalers who have been doing things on their own or with a small team. 

I bet you are quite the salesman for some people.