You'll need money or you'll need to have the ability to raise money. 

After he was finished with the roof and gables he sent us a bill for and extra $13k and said he could not have forseen the condition.

Essentially, the ability to have your purchase price + rehab costs less than 70% of the ARV, so after you rehab you can find tenants & then refinance to get all of your cash back.

The ability to buy rentals that will have equity, and you'll be able to learn the ropes in property management.

My rental income covers all of my monthly costs, and the ability to maintain the lifestyle I was used to.  

If, however, she has the ability to move in with your, or another alternative homestead temporarily, and get property 1 leased, she could use up to 75% of the rental income to qualify for the loan on house #2.  

Mortgage banks and brokers, have the ability to not only shop rates but shop loan programs.

Screening has two priorities, #1: a tenants ability to pay and #2: the landlords ability to collect when they default.

Would you start out trying to find low cash down deals, such as seller financing, and have the ability to invest in more properties.  

I would only be concerned with his ability to get a loan or another source of financing in 3-5 years when the balloon comes due.