Maybe that lender has some sort of weird requirement regarding where the funds need to come from, but typically a HELOC isn't an issue....

I'm glad you're liking it so far, I've run into the same thing with clients where the HELOC sort of throws things off. 

Less ideal outcome is buyer has to come in with a bigger downstroke, absolute worst case scenario is they can't, and we all just wasted our time.

Verifying last 2 years of rental history and income extremely important to find the “best of the worst”.Make sure you understand the Class of properties you are looking at and the corresponding results to expect.

I put in a little work developing a high level scope of work, assigning values and 3 resulting estimates so that I can not only determine what I think it will cost but what the best and worst case scenarios likely are.

I am thinking that if we could come up with some sort creative financing contract, we can both benefit greatly from this deal. 

But given that it's sort of like an Angies List for members, at least there is a better chance of being treated appropriately by the vendor.

If you're now in Salt Lake City (or surrounding area), a house hack may not be the worst option, because you'll get favorable terms and require less down.

Issues like this can take a while to sort out depending on if they can determine where/when the error happened and if there is any party or title insurance who will compensate someone for the error.

I'm not sure how much I would do with a tenant in place, but I'll give you some common scenarios that could cause  these sorts of things:1.