There are some other dynamics that also will likely play a factor in making the situation great for investors...such as runup in home prices and interest rates probably created a permanent renter class of society. 

I have consulted with a few attorneys over the past couple years regarding this and have determined that for my own personal situation, umbrella insurance provides sufficient risk mitigation for my situation at this time.

As an accredited investor you have access to hundreds of new potential syndications every month (and crowdfunding deals which are the same thing except are allowed to market on the Internet).You may want to start off on a site like CrowdStreet or FinResi , where you can view the variety ( different types of asset classes, strategies, stances) and start to come up with your own method for looking at deals (which matches your unique, personal  risk tolerance, financial situation and financial goals).Thanks Ian.

Your property listing can also be a great way to lay out qualifying criteria (i.e credit score minimum, and require a co-signer if lower).After conducting due diligence into a particular tenants situation, and you decided to proceed with an application approval, you could require a higher security deposit. 

I need some perspective on moving forward after this situation with my family. 

The downside is you now have a situation where they make more money the longer it takes to get your house rented. 

My guess is You will need to go through a foreclosure process in this situation as a legal remedy.

. 💪 As for next steps, I'd focus on stabilizing your cash flow first, especially with the credit card debt situation.

Right now I am in a unique situation and I have a concern.I want to buy a residential property.

I would work with the lender and put together a well thought out Reconsideration of Value (ROV) with better comps and detailed reasoning to justify the higher ARV.There are lenders that don't do appraisals for hard money loans so you could try that in the future to avoid these situations.