If you cant quite qualify, then charge slightly more in rents, that will also help reduce your debt ratio.Bottom line, if you want to go forward, don't listen to banks that tell you no.

She is now more than three months behind, and now the Housing Authority has reduced her subsidy.Given that she is on month-to-month, can I serve her with a 30 day notice to quit, or does S8 status trump all and require a 90-day notice?

Cash on cash would then include the principal and interest received after reducing the amortized portion of your purchase price, that is the return of capital, not profit.It is what it is and there is nothing more, buying notes at a discount can give an obscene return which should be plenty.

Expenses need to be looked at carefully, to see what can be reduced.

Ended up having to reduce the rent by $100 a month and filled it at the end of December.

You might need to defer interest on the 2nd note or reduce the interest rate.

A house hacker can justify paying higher prices knowing that they will still be reducing their living costs over buying a SFR. 

Anyone who gets conventional financing or has loans on their properties knows the importance of reducing maintenance. 

Reduced maintenance costsIf the building is more efficient, less water (water heating/boilers) and less conditioning of air (HVAC) is needed.

Can you bang one or two of them off, sell it off and reduce your risk?