I'll go ahead and admit that the decision to keep the lower tenant may not have been the best idea so don't beat me up too badly there.

I'm thinking that if it meets my criteria and cash flows then go ahead.

@Mike Wood  10% is very simple in the performing note game... and other investment vehicles with probably a lot less risk as well.My main point to take devils advocate here is for others who read this and wonder how do I attract capital when I have none but I want to get in on the equity side.. and that is to always give the money the lions share until you have a stellar rep..I mean I still do this to this day... and that is why I am NEVER without more capital coming at me than I can deploy..

Its hard at that age, but it will give you a head start. 

Meet with multiple lenders ahead of time, tell them your plan, and ask for their advice on how to make it doable.

You are losing money ever month if the equity does not earn it's keep ahead of the property.When you have a property with 100K in equity at the beginning of the month the first deduction off of the income is the 10% due to the equity = $833, you then deduct your debt repayment and your expenses leaving your cash flow (negative or positive).If you have 200K in equity you deduct $1666 from the rent each month.

I think you'll find that you'll be losing money every month.To your question, yes, in absolute dollar amounts, mortgages are expensive..i.e. 158k expensive in this case, but there are lots of ways that they allow you to get ahead if used properly so think of it as spending money to make money. 

We too have policies and procedures in place that prohibit washing vehicles on the premises.

I'm not sure if I should buy a cheaper 1 bedroom or 2 bedroom place for me to live in for 5-10 years of if I should go ahead and bite the bullet to purchase a 3bd 2bath with hopes of one day turning it into a rental (because 3 bd 2 bath make the most sense for rentals from what I've gathered).

Doing this with an engineer's salary right out of college will catapult you ahead with stockpiles of money to invest by your mid-late 20's.