Again, working on networking to grow my leads into more lucrative deals.I would say that my current situation is "working" although there is a lot of room to grow. 

Every investor  has a different risk tolerance, comes from a different financial situation and has different financial goals.

However, I just purchased a 5/2.5 perfectly situated next to a larger university in Chattanooga and it has been very hard to find tenants.

I don’t know your living situation or if there are any nice 2-4 unit buildings in the area you’re moving to.

Your cash flow situation has just gotten worse.  

Does anyone have any practical experience with similar situations and if so what was the outcome and how long did it take to resolve everything?

There is some additional information that wasn't mentioned in your post above which sheds a different light on the situation.  1.

What is the best way to manage this situation before the inspection happens?  

Quote from @River Sava: Hey April - Refinancing after a year if there's limited equity depends on your goals—lowering your monthly payment, cashing out, or switching loan types.The process usually involves checking your current loan terms, appraised value, and credit situation.

I’ve seen situations like this before, and keeping control of the contracts has always been the better play.