I will say having that passive income is tempting but it would come at the cost of doing a full blown condo conversion to free up the capital.Anyways, am I thinking about this right? 

Sec.8 Tenants can't  - they have to wait for the housing authority to be approved.BTW, I never discriminate against a source of income.

It makes the same or more amount of income per unit without the risk or cash outlay at the beginning.

If you have to, interview a couple until you find one that you "click" with. 2) Let that agent connect you with their network of investor-friendly lenders. 3) Meet with these lenders, have them talk over your finances with you and what loan products you would qualify for at the moment based on your income and assets. 4) Let the outcome of that conversation (#3) dictate your strategy moving forward and take your findings back to the realtor so you can craft a plan. 

I can at least take a look and see if there is a creative way to play this.Regardless, I'd start renting the property immediately (assuming it's rentable), and starting bring in some income until the foreclosure.

Also, focus on 2 years of job/income stability.Class D Properties:Cashflow vs Appreciation: Typically, all cashflow with zero or negative relative rent & value appreciationVacancy Est: 20%+ should be used to cover nonpayment, evictions & damages.Tenant Pool: majority will have FICO scores under 560, little to no good tradelines, lots of collections & chargeoffs, recent evictions.

.' - Investing in multifamily properties can be passive with property management services or investing in syndications.Don't let excuses hinder your potential for financial growth and passive income streams. 📈 #RealEstateInvesting #MultifamilyInvesting #FinancialFreedom"

Several reasons:  Phoenix is an expensive and hyper-competitive market; your monthly income is $4K which in and of itself is limiting, but even more so with most of that being cash; and your credit score, while not terrible, needs to be raised, especially with you being self employed and a mostly cash income.

If so, this is not uncommon and should be budgeted as part of your annual maintenance expenses.

My recommendation is to choose cities in safe and economically diversified areas with above-average income and population growth.