My credit score is 685, our W-2 and small business income is great, we don't qualify for FHA because we currently have one (home under an FHA mortgage) that we intend to keep as a rental. 

Home Possible not only has minimum income requirements to qualify for the loan (with DTI), they also have income CAPS which LIMIT the amount of income you CAN make in order to qualify for the program. 

There is a new 20% pass through deduction you may qualify for that could help you, but not everyone qualifies.

I don’t qualify for an FHA or regular conventional loan due to the fact that I did a short sale in 2016 so I was asking him about doing a hard money loan.

. $120k, but would like to do $75k down and keep about $45k for remodel unless we can finance itSource of down payment funds, if applicable: current home proceedsIncome Source: Salaried plus commissions/bonus - but both wife and I have to qualify with base pay only since we do not have two years at current employers.FICO: ExcellentI think seller financing the whole thing is too risky to us (seller wants $100k down and balloon in 5 years).

@Hakeem Valles I agree, we'd love to rent just to military members, but what is hanging us up is you can't turn a regular civilian away if they're qualified...

Those are all easy jobs that require sweat but not skill.  

For these bigger projects, qualifying for LEED certification can become important depending on all the grants, tax benefits, and other "funding" factors.

How are you going to make more money off of commercial if you are not in the industry now and have the skill set?

I've acquired some wood working skills.