Capital attracts capital.Further, if you fall into hard times or something goes wrong, you can get all sorts of deferments with student loans that you can't with other forms of debt.Or, you can take the middle path. 

They are rated in "C" classification, but not Section 8 so far as we know.Some deferred maintenance on each house.

Is the 1030 exchange a good method for flippers to defer taxes?

A 1940s property can have a lot of "issues" you may not notice.)I would only buy and rehab with cash if you then do a deferred refinance to get your cash out.  

Pros - Tax free or Tax Deferred income- You are in control of selecting the propertyCons-There are some prohibited transactions to be aware of

Switching lenders won't help you because I believe the appraisal belongs to the VA, and they have it on file regardless of which lender brokers the loan.Your agent doesn't sound to blame here whatsoever, as any good agent will have you defer to the judgement of a real expert of a particular issue - in this case, your lender.

I have looked at a few properties within the city limits mostly in uptown and old uptown and what I saw was a lot of deferred maintenance and deferred cap ex.

This would allow you to defer to the payment of your taxes, remain fully invested in rental/investment real estate, pay off your debt with cheaper debt that would also likely be deductible.There is not really a right or wrong answer, just many options.

Deferred expenses etc. 

There is LOT of deferred maintenance. 12 Units are in a better part of town.