Chances are you have someone with honor transparency and integrity on your hands and that is very rare.If the answer is no... well, if he lied to the homeowner, why would you think he would not lie to you?

They had equity in a rental and wanted to try their hand at flipping.

Not sure if hard money would be the correct route to go for this one or notHey @Scott Allen I generally run the initial underwriting to minimize the developer's equity (@Shayan Sameer) based on the max LTV % or LTARV % that the handful of HMLs that quote me on my deals.

Unfortunately, though, after meeting with contractors the scope of work got out of hand and I had to back away.

Since your a hands on person and have contractor contacts.  

The very first day that a tenant is late, a Notice of Default needs to be delivered to the tenant (you need a receipt of delivery; if you hand deliver it, place it in a sealed envelope with their name on it marked 'urgent/confidential' and take a photo of it placed on their door). 

So, to try to go a legal route because they might have fixed something a little over the limit isn't going to work.You will have to face that you selected someone that was not the right fit and be more hands on. 

The very next morning, he was at the seller’s property with a contract in hand.

Cash on hand and conventional mortgage Lessons learned?

Most lenders don't seem to like doing them, I on the other hand love them.