As such, you can see a bidder synopsis.You are seeing a set of numbers that take the offer price, subtracts the three components of the commissions, and then the bottom number is the minimum acceptable to HUD.When you are counterbidding, adjust your offer until the BOTTOM number matches the counterbid amount.Never forget you are dealing with "the evil empire"... no emotion... time on market, fixed percentage discount... take it or leave it.

I have a property in mind that has great cash flow, but I was told she can't use her income to qualify for a loan since she is on 'temporary leave' even though we have 25% for a down payment.

They are relying on emotions which are 100% unreliable even if they are some times correct. 

If it was due to a temporary blip in a persons life that is different than a pattern of poor money management and disregard for debt responsibilities.

I agree, Hawaii is an area to consider, but buy financially, not emotional... you might benefit by reading this post about Hawaii Vacation rentals...https://www.biggerpockets.com/blogs/8050/48883-buy-a-hawaii-vacation-rental-and-have-it-pay-for-itself-unicorn-alert

Prior to these sites emerging to dominance, I wouldn't have gotten near a VR with a ten foot poll; with this new platform, though, it can be incredibly rewarding if executed correctly and something I help interested clients to pursue.As Justin said, how selective you are in the neighborhoods you choose to invest in (AKA: being very thorough with your due diligence and making sure to avoid the neighborhoods where people are likely to take issue with short term rentals operating in their back yard and attempting to make formal changes to legislation) will go a long way in dictating the success you have.For instance, Del Mar just recently put a temporary stop to any new short term rentals operating in the  Zip Code and are currently 'sorting out' the 'unclear verbiage' regarding short term rentals in their municipal code.

You said it best, "I am having trouble getting past the emotional aspect of selling the first place I purchased..."

In person sometimes the view ( emotion) tries to over ride the numbers (logic).

I want to avoid making any emotional decisions but I also want to avoid getting stuck with an old junker here by all costs...

We are here for you as your real estate family and although I am not skilled enough to give you real estate advice I am here for you emotionally and that is half the battle.