She declares bankruptcy/pays off those cards with the cashed from the sale and moves forward investing as a business entity.additionally, her personal residence is income producing as well since she rents out two rooms on Airbnb and runs her cleaning business out of an office there. my questions are1.

I'd ask for the rent roll, or income statements.

If you can throw some of the excess income from the high season months at paying down your balances and lowering your credit usage you will very likely raise your credit score.  3) With a higher credit score and lower balance you could probably consolidate the credit card debt into a lower interest personal loan.  4) You need to analyze your listing and your pricing to make sure that you get more off season bookings. 

A DTI (Debt-to-Income) ratio of 50% or lower, when including all expenses you pay/month, would be safe IMHO.

Cashflow=Rental income- expensesRental income: how many rooms will you be renting out?

While you may be able to make 200/door you probably lose that with lower appreciation.I would run some numbers on new purchases in Denver and one or two Midwest markets (using zip codes for household income to identify your b- neighborhoods) and see what makes sense.

I'm not finding much unrenovated even that is even near 4% cap (net income divided by acquisition price).

In general 10% of valuation in gross annual income.

If you have good W2 income you’ll see your wealth accelerate faster in CA once you get into REI.

Many states do have exemptions if the beneficial owner has not changed - like in your case.Federal - there are no income tax issues here.