The buyer and seller agree to pay the 20% back to the seller at whatever agreed rate and time.Therefore the buyer obtains the property at essentially 0 out of pocket, but is on the hook for a mortgage and paying the seller back?

Essentially let him wipe his hands of it.   

This most recent month she was late, her lease specifies that there is a $25 late fee for each day of late rent and essentially after the 3rd late day if everything is not paid there is indication of the landlord moving towards an eviction.

Essentially, I have a property that is getting sold with a potential of 58 k in capital gains, bring the total investing amount of 128k ish.

I can see that each rental will provide income but the cash flow annually seems disproportionate to the loan and the overall impact to the DTI ratio?

For example, I am not counting your full mortgage payment to include principle or the accompanying amortization on the loan balance, which essentially wipe each other out in terms of net worth, but may cause you to cash flow negative. 

An eviction must be “opened” (filed) with the court to essentially get the ball rolling on everything.3.

However you're essentially selling a home and I don't know how you can do that if you don't even know what it is.

So essentially, both of you got the deduction. 

With your current estimates, you're essentially assuming infinite lifespans for the property's various components (roof, foundation, HVAC, electrical, plumbing, water heater, etc.).