To be conservative, if you take this gross rent number and reduce it by 25%, as long as whatever is left over covers your PITI(A and PMI if applicable) payments, then the hit to your DTI would be zero. 

The heat pump technology is more efficient than electric baseboard and the AC is a nice addition.

Keep your emotions in check really hits home for me.

Although the Phoenix market may not be over priced, much better cash flow can be found in the Midwest.Also, if there is a correction in home prices, Phoenix may potentially get hit harder than other areas which have not had such rapid appreciation.

If you’re not able to hit those numbers (or come close), then I would encourage pulling out your cash and hunting for deals.

You hit the nail on the head.

@Michael L. hmm you could use chucking to pay more towards the principle then the interest avoiding the refi and the 13 years you still owe on the property the time frame would be cut in half (at least by  half) because now your paying more towards the principle, your credit might take a hit but you get to keep the property and rent it for your 2400 a month.

Family will play on emotions when trouble hits. 

The wife checks out but her husband has a litany of criminal charges: hit and runs, DUI, etc. from not too long ago.Is this a legitimate reason to deny them? 

If you are in a smaller market area (100,000 population, is a small market), it is often difficult to find a broker who has both experience and an efficient database.