You will get more for it" and the prospect would proceed to tell him everything that was wrong about the house.

If he agrees to the lease then continues to do this, fine him and follow through on eviction proceedings if he doesn’t pay and cure the problem.

The lender and the homeowner would have to be notified and involved in the court proceedings and there needs to be proof that the homeowner and lender were notified several times.

Then, you distribute the $1m of proceeds - you have distributed $100k more than you have basis ($900k less the $1m) - you recognize $100k of capital gain for distributions in excess of basis. 

In the request for order of possession, where is lists the cost in this proceeding, can I add the current and future two months' rent, plus additional costs including court, mileage and hotel stays ect.

It’s from the loan proceeds.

If you proceed with optional Repairs/upgrades you will likely bust budget (hopefully not as bad as we did), but should have years of trouble free service.  

Sounds good.I am in to moderate on a subject each week/month.How do we proceed from here?

They just proceeded without question and finished the entire house. 

So, you'll want to check into that before proceeding further.