From what I read the arms length guideline doesn't apply in this situation.

And then using what's left to payoff probably relatively low interest loan that you have on your rental and loosing interest write off deduction doesn't sound like a wise financial move...Why don't you consider setting up a self-directed IRA, moving your Vanguard IRA in there and then invest passively in trust deeds (or some other alternative assets).

They may take a discounted figure for your IRA (like 60%), but that doesn't seem like that would be an issue for you as 60% of $500,000 exceeds $200,000.

He is there to help you, it doesn't matter if this person specializes in investments or not, you have no reason to withhold your intentions from someone trying to help you.In a hot market you may not get a response to lowball offers. 

Texas doesn't mess around with these things.If it's a shortsale, it's not going to happen.

Yes, but that doesn't mean you can't get in the game. 

OOS investing can be great when you live in an area that doesn't have good properties, or you can't find the deals you want.

Congrats on the twins, typically better location attracts Better tenant, where as upcoming neighborhoods doesn’t, so your exit strategy comes into play.

It doesn't look like they've expanded their markets to Houston yet but that's bound to change.  

Shortly after signing-up and creating a second "admin" account, which is NOT an admin account because TC doesn't accommodate true user management, the second account was locked-out.