Subsequently confronted tenants, and tried evicting them, however they had no money to move.

With any delay, you risk incurring additional fees or cost if the tenant subsequently claims that not having their car resulted in additional expenses of who knows what amount and distress. 

I bet she loved it when I paid ~$2M for a subsequent property.  

Once you've determined the deed is a sale, then you look for a subsequent deed of trust.Cash sales a trickier then normal sales.

He did it again and got arrested and thrown in jail... was not pretty .I don't know anything about your state.. and I do see in Texas were its pretty common to tie up a property on an 100 option.. but the buyers and sellers are all fully aware of what is going on.. the way you made your post and the subsequent advice you were seeking and given clearly indicated that your sellers are not fully up to speed on your motivations and your end game.

“A primary concern was that the legality of purchase options associated with rent-to-own properties are largely untested and there is a possibility that these purchase options could subsequently be found to violate consumer protection and/or predatory lending laws,” KBRA said in its report.This presents multiple, serious problems for any investors who buy into a securitization backed by rent-to-own  or lease to own properties, KBRA said. 

The first draw would be to pay off the existing lender and subsequent draws would be for the actual build out. 

Typically if you are paying a business such as a Corporation or LLC, a W9 and subsequent 1099 filing are not required.

I don't think it was mentioned yet, but once you lower the price and get a decent tenant, then you can always get that 3-5% raise in rents in subsequent years/leases.

The tenant was found unconscious by the fire department at the property (suspected smoke inhalation), was conscious on the way to the hospital in an ambulance, though was subsequently put into an induced coma due to soot in lungs.