I want to keep my current financial position in these properties for tax purposes.

The seller however does not have any documentation to show he made any reasonable efforts to evaluate the borrower ability to pay the loan.

If he does ask, tell him you can rent something comparable for 30% cheaper and it's in your financial interest to do so.

The loan we were applying for is an FHA, which stipulates we must provide a signed lease for our half of the duplex (to be newly rented out) but for the other half which the parents "own" (in reality all three are equally owners of the entire property.) we would need to provide proof of rental income on our tax return, however her parents claimed that so we seem to be SOL.The mortgage is covered, we can rent it out no problem, but the underwriter is saying on paper it looks like she is responsible for the whole duplex and the rent for half of it is unreportable.

I want to bid on a foreclosed property offered from an online auction but want to know what due diligence should be considered besides financial analysis.....

For the rehab loan, I would look at options longer than a 12-month loan.

The loan is conventional and they are asking for Employment Verification saying I work remote in order to settle the occupancy rule. 

Does anyone have any recommendations for a real estate agent that has experience with VA Loans (specifically- assumable VA loans)?

You best choice may be a secured loan in the US.  

Pricing and rates change constantly so if you are seeking cash out of a rental property you can entertain a second DSCR equity loan up to 70CLTV to keep your first in place or take a look at a full new cash-out option.