However, allocating 80% of a building to low/mixed-income housing is a bit aggressive given the neighborhood character and the potential effects of that understandably violate the basis for why so many people move into Jefferson Park.

Also, my dad does contractor sales at Lowes so I'm running everything by him on materials side to see if what I'm being quoted sounds reasonable. 

I just believe the 200k cash offer is waaaay to low.

@Derrick BurtleUS bank does loans as low as 35k

No we did not come to any terms, the seller's equity in the property was very low which took owner finance off the table.

I'll warn you, mine are low.

In my mind, a house hack should create a very low ($500 or less) monthly housing expense or eliminate your housing costs all together.

On a whim I just thought I should check it since she never seems to have money, and low and behold it was canceled months ago.

If you have done your homework and the property is sound, there should be nothing materially wrong such that a reasonable insurance policy would not cover.If you continue to do your homework and screen your tenants properly, you should have a low risk of them destroying the property that an insurance policy would not cover. 

My concerns are I am currently working on my credit (low 600 Fico), I have limited savings and the house is in need of renovations to bring it up to date.