My recent post in this thread references lawyers you can call.I’m not naysaying, but a 3 to 5-year loan is unusually long for hard money and a bit risky.

Your calculations are spot on  I just had a bid on a Hud  property which turned out to be a unusual email from Chronos  The home was under contract and the buyer left the water on or there was a leak and caused about $10,000 in damage (according to Hud) They migrated some of the damage pressured tested the water and it was back on market I bid a net of $171,000 or so to net (list price was $195) and received an email from Chronos that the minimum acceptable bid was $171, 321   i was able to up my bid to the acceptable amount and now have it under contract This was the first time Chronos  directly intervened in a bid The only bad thing is I am only allowed to activate the electricity and not the water and gas Also cash is an option on the contract and they treat hard money as cash   Electronic signatures are also acceptable goodbye blue ink 

It is more probable that the tenant convinced the landlord to bend the rules so they could stay in the house.  

Marginal business practices, bending rules, short cuts... all caught up with him and those (generally) who were not a "quality mentor" or a "quality trainer".

And if there is a conflict the court system will bend over backwards for a dead beat tenant or squatter and hold landlords to a entirely different standard. 

A commercial appraisal will include giving value for the income potential, so for a property like this it wouldn't be at all unusual for a residential appraisal to come in at $950k and a commercial one to come in at $1.1m or some other higher number. 

It's not unusual to have tenants paying $800 pm what would be a $2000 plus market rate unit.TOPA in any of the jurisdictions that have it doesn't really concern me.

(sometimes the caps bend or break trying to get them off) All in all, it's not a complicated job for a Roofer that knows tile roofs.

I suspect highly unusual.

A lot of what scares you here is probably not too unusual for an old house.