How have you handled this situation? 

Nice situation where talking to a neighbor resulted in the purchase of a house! 

Dissolving the LLC and distributing the property to the former members as tenants in common and then selling is a relatively common practice in these situations. 

Let the tenant know this in writing and if you need to, also speak with them, but always in writing first in these situations. 

Sorry you’re dealing with this—sounds like an incredibly frustrating situation.

There are laws (and statutes with three "T"s) that may apply in these situations on both a state and federal level.

I think everyone's situation is different, and when one crafts their buy box, they need to consider their current family and finances.For me, when I started, I wanted to buy 2-4 unit distressed properties in neighborhoods I wanted to live. 

Wasn't aware of the whole copy paste situation.

I totally agree with the idea that local markets offer better value in the long run that cheaper out-of-state markets.Finally, Just because an experienced property manager would not do a house hack or purchase a small multifamily property does not mean it would not be a good fit for you and your situation.

Would you recommend the route of a first lien HELOC based on the above situation and information?