A lot of people have that much debt on their primary residence.I’d say pick up 2-3 more with mortgages then start paying them down.OR if you want the higher level of involvement, build cash to start using the BRRR strategy.

I have invested in NZ, OZ and the USA in addition to being involved in real estate in several other nations.

What's the bet that you're paying a much higher interest rate on that car loan (for what is essentially a consumable item) than if you'd bought it with proceeds from a HELOC on a property that you (could have) wisely bought first?

People don't want to get sales calls at home.A better bet might be to do some mailing. 

I'd like to try something that doesn't involve me going back there with a shotgun in the middle of the night.

Your best bet might be family and friends.

The reason he hasn't involved an agent because the purchase price is not far from what is owned on the home so there's not much room to tag on a commission.

135K, plus closing, plus at least 45K in rehab (has foundation problems, needs new roof, is built in 1982...willing to bet 45K+ plus required)...with an ARV of maybe 200K?

Or as long as I am open and truthful with everyone involved, I'll be alright?

I would error on cautious side (pay her back) when family is involved, but that is me.