I tend to be conservative overall, but if you are pulling out enough cash to purchase and renovate another property, AND you have another property or know there will be another soon, then you will be in a better position buy having 2 properties, with one owned in cash, more than likely.If rates on 3.25% and you are doing 30 yr fixed mortgages, every $50,000 loan increase/decrease will cost/save you $217. 

I have a habit of being very reactionary in stressful situations so my hope is with more knowledge that I can condition myself to avoid overpaying.

How stressful is it to deal with low income tenants?

I spoke to my lawyer in regards to my options and i have 3 options:1) Keep the existing lease (exp Oct 2021)2) Provide a new 1 Yr Agreement3) Month to Month LeaseWhen i initially spoke to the tenant, the tenant was stressed out about signing a 1 yr lease, and i wanted to give him the benefit of the doubt (before i found out about the payment issue). 

But the Fall/ Winter months are incredible, and as long as you pay the $400-600 a year for Flood Insurance, much of the stress is alleviated.  

Downfalls, it is small town that has had history of getting hit hard in recessions with high unemployment and decreased property values.

Much of these considerations, by U.S. banks, are getting their spread sheets & accounts books looking in better order, as they face the the FED is now asking banks to be able to pass stress tests, in case any financial crisis, like occurred in 2008-2009, might flare up in late 2020 or in 2021.

I tend to pick a good location with good school to decrease the vacancy and try to be recession proof.

This may sound simplistic, but I stopped stressing about all the little fees a long time ago.

Firstly, you should realize that you do have control of the situation, you just need to let the tenant know that ASAP.We all know that moving can be stressful, but it does not release an adult from their responsibility to comply to the lease terms they agreed upon.