Was the owner doing his own repairs and hiding the costs?  

I will say REPS is one of the areas of the tax code where it is very costly to get wrong.

However, it is mostly geared toward a person who has a W-2 job themselves, which is not the case for me, so there are some applications that I am finding confusing. 

The reality is you would really be renting to and depending on the husband whom you can not screen.To be honest I have never had a perfect applicant so it has always been very easy to justify rejecting any applicant for a reason that is not discriminatory or a violation of codes. 

My application says the home should rent for $1500 and is worth $195k. 

Tax Free Wealth" - will help you understand all the tax benefits of investing in real estate."

I'm not sure what the renovation cost would be to set this up for a rental.

These properties are valued at a combined $430k and are both mortgage-free.

Property details are below.Property 1:Cash flow: -$730 / monthPrinicipal + Interest: $1,790 / monthEquity after sales costs: $110kExpected IRR of holding: 27%Property 2:Cash flow: -$200 / monthPrinicipal + Interest: $620 / monthEquity after sales costs: $20kExpected IRR of holding: 35%Property 3:Cash flow: -$310 / monthPrinicipal + Interest: $690 / monthEquity after sales costs: $45kExpected IRR of holding: 26%Property 4:Cash flow: -$500 / monthPrinicipal + Interest: $1,135 / monthEquity after sales costs: $45kExpected IRR of holding: 16%Property 5:Cash flow: -$600 / monthPrinicipal + Interest: $878 / monthEquity after sales costs: $40kExpected IRR of holding: 16%Total portfolio:Cash flow: -$2,340 / monthPrinicipal + Interest: $5,114 / monthEquity after sales costs: $260kExpected IRR of holding: 24%

The gain allocated to the OO unit will be tax free up to $250,000 if single or $500,000 if married.