She doesn't need a "salary" from the flipping business, but is not opposed to taking some income as salary or distributions to reduce any unnecessary tax burden.

I am interested in buying foreclosures at a greatly reduced price for flipping as well as buy and hold. 

So that is a consideration.Beware renting and then moving back in as there are restrictions and some depreciation recapture issues to deal with that could reduce the amount of gain that would then be tax free.Looks like you're in a great position to take this sale tax free and then move right into that next house and live there for 2 years before selling and once again taking the first $250k/$500K in gain tax free.And what if you banked the profit from the sale of the condo and in a year or so added to it and bought another house to fix and move into?  

Obviously get no takers, then a week later offer it again at a reduced price, then again, and again....leaves a bad taste in my mouth.

I definitely like the idea of asking the inspector for a a highlights of the inspection for a reduced fee! 

I understand the gov't is reducing housing caps in some areas as well as plug up this loophole for buying. 

I would offer her $130k and let her know that number will need to be reduced if black mold is discovered.

By reducing price the 6% you would have to pay a broker they may be able to afford the house...I did this once and I even took another $3,000 off the price for the upgrades I would have had to make prior to listing.

You would also likely reduce your living costs, allowing you to pay down more debt.I did a quicko glance at realtor.com and I see there are duplexes and triplexes available in Mesa for 150k and less.

Add to that the fact that the property probably feeds schools below a "6" on GreatSchools.org, and you have further reduced your pool of interested investors.None of that is said to discourage you, just to make you aware of the reality of the situation.