In addition, I had to pay an additional 1% down payment so that there was time for the loan to get transitioned to the final lending institution before interest accrued and exceeded the max approved credit limit before I had a chance to make a payment.

Unless you have access to outside LP equity (not mezz or high interest accruing pref equity) that is closely aligned with your objectives my advice is to stay the course.

I was going to also increase their late fee significantly or to accrue daily, but a new law in CT just set the limit to $50.

“Gross income includes rental income received or accrued for occupancy of real estate.”26 CFR Sect 1.61.8 (a) Rents; & 26 USC Sect 61.1 (a)(5) Rents

Do the banks/lenders have the option to pay you back, with interest accrued or you get the property?

Hi, I bought a property on a 1st loan mortgage foreclosure. There is HOA debt in the amount of $21k piled up from previous owner. Who is responsible to pay for the HOA debt that piled up prior to foreclosure sale? Me ...

The losses accrue until I either have a profit to net them against sell of the property (which I am going to buy and hold). 

This could be as high as 18%, per the statutory maximum from FSS 197.172(1) or, very often, as little as 0.25%.197.472    Redemption of tax certificates.(2) When a tax certificate is redeemed and the interest earned on the tax certificate is less than 5 percent of the face amount of the certificate, a mandatory minimum interest of an absolute 5 percent shall be levied upon the face value of the tax certificate. [...]Translation: When a property owner pays their delinquent taxes and thus redeems a tax lien certificate, if the certificate has yet to accrue a total of 5% at the rate at which the winning bidder won the certificate, then the winning bidder receives 5%.

Don't forget to pack your curiosity and willingness to learn – they'll be your trusty companions on this exciting voyage.

Ha, where did you live when you were in TX out of curiosity?