As Matthew Brill mentioned, there is a self-sufficiency rule for 3- and 4-unit properties funded with an FHA loan.  85% of the market rents on all four units need to cover your monthly payment (principal, interest, taxes, insurance, and mortgage insurance).

You don't need a reason to not renew their tenancy, you just have to give them sufficient notice.As for the inherited tenants, when we inherited tenants we sent them an introduction letter a couple days after closing.

All of the notes where I found that the property owner and borrower that didn't match were first position.I also see the appeal in modifying a loan for an owner occupied underwater property assuming that you acquired the note at a discount sufficient to provide room to do so and still earn a profit. 

Rather than dealing with skilled and shrewd loan brokers, you're instead just working with a seller to solve a problem.Sellers who are most receptive to a financing offer need to sell but can't, often because they lack sufficient funds to make necessary repairs or to engage an agent.

If you have the cash and you want to buy a personal residence, it sounds like you have sufficient capital and income to support a new (modest) house and the losses you will incur on the condo. 

This may be sufficient for the total down payment on the next deal.  

If this is the extent of the damage, and there is no underlying/ongoing problem, then cutting out the loose material and spackling should be sufficient (and painted of course).

A simple letter stating that it is your intention to terminate the contract and that it will serve as your 30 day notice should be sufficient.

It will payoff in the long run.Suggest managing the business types in the center AND getting sufficient parking - - these kill accessibility and traffic flow.

The latter is not sufficient for recording, but is more readily available.I vote for @David Krulac suggestion to request DC from funeral director.