1st tenant (that came with the house)- she is a Section 8 tenant and clearly knows the game better than me hence the prolonged delayed Marshall’s execution.I cannot have 2 Government assistance programs in the property at the same time since it is not a legal 2 family.

But if it's coming at the cost of your health or something else important than time with your family then it's perfectly fine to step back when you need to.I think this goes without saying.

diversification and cash flowSan Jose, CA has been very appreciation heavy... and i'm not opposed to keeping some property here, though the multi-family / commercial real estate has very low cap rates, and low growth from what i'm seeing.

Live in the multi-family for a year, then move back into your own home and rent out the unit.If if not ideal, it's worth the hassle. 

With good software available so readily I'd say nah, but you have a partnership with non-family.  

The common thought is to not rent to friends or family.

@Robert D.Sounds like you need to speak with a family law attorney about separate versus community property rules, as well as possible creation of a pre-nuptial or post-nuptial type agreement. 

I am thinking of getting a list of leads and using the owner info to mail postcards or letters to find small multi family.

Playing small won’t serve you or your family.

It would be helpful to me at this time, to have about $25K in working capital for work on one of my multi-family properties.