Here is what I’m thinking:Was intending offering a 3-5 year option with owner to finance balance at end of option.

All NOW carry low loan balances and live in same home.  

. :) You could find a couple cards with zero percent balance transfer offers and move the balances to them to stop the interest charges.

They seem to be doing fine as they have managed to keep a balance of about $6k in their bank accounts but would I consider them very risky and I don't think they can afford paying $2,200 rent without facing financial hardship.

If she hasn't, I would definitely start the eviction route, as it will be much more difficult for you, if she's in jail.

I copied this from a search on real estate ROE:Return on Equity (ROE) ratio calculates the amount of return generated in a particular year on the total amount of equity invested (or trapped) in a property.The amount invested (or denominator) is calculated as the initial investment (down payment) plus the entire increase in net property’s appreciation and the entire decrease in outstanding loan balance incurred prior to the year the ratio is being calculated.Cash-on-Cash Return is a similar calculation, but since the two draw backs of the traditional Cash-on-Cash Return are that property appreciation and principal debt payments are not factored into the formula, Return on Equity adds these two components to the traditional Cash-on-Cash Return calculation.A property’s net equity increase is calculated by determining what the “Net Sale Proceeds after Taxes” would be at the beginning of a year, and then again at the end of the year.

Likewise, if a family member is buying a house from you, you are allowed to provide a "gift of equity", again, no limit nor tax implications for this.I can't speak for every lender on the income thing for loans here but in general, an investor friendly lender should use the rental income to counter balance the mortgage. 

Sorry about this miscommunication, I know it may be difficult to read on there! 

@Travis Rasmussen @Hadar Orkibi @Kim Meredith HamptonIn terms of why I’m moving and changing strategies a bit, it’s a relatively straightforward answer: refinancing (or putting financing in place because I’ve bought with cash) a portfolio of SFR has been really difficult.

It is difficult to apply it to a piece of property, but not that difficult to apply it to a real estate service.