. -- Thus, you can expect to get Class C or D tenants, which have a 15-25% probability of defaulting on their lease payments.2) If your PMC is lowering FICO to 550, what are they doing to improve their screening in other areas?

Can try to reposition to Class B, but neighborhood may impede these efforts.Vacancy Est: Historically 10%, but 15-20% should be used to also cover tenant nonpayment, eviction costs & damages.Tenant Pool: majority will have FICO scores of 560-620 (approaching 22% probability of default), many blemishes, but should have no evictions in last 2 years.

Furthermore you can vastly increase your returns through leverage using a non-recourse loan but that will definitely trigger UBIT but again the numbers can still make a lot of sense. 

Also a non-starter is your hyperbolae; "toxic waste lot's"......

Give proper legal notice of non-renewal and get them both out.

It might make the most sense to just sell your primary residence and use it as 40% to 50% down payment on your future home. 

What we've learned is that Sec 8 residents would usually stay longer than a non-Sec-8 resident.

Can anyone shed some light on what kind of down payment, terms and qualification requirements we would typically be looking at for an SBA or low down commercial loan?

Since you are in a non CM state, You are EACH considered a member. 

You have to find the areas that are either zoned for Hotel and Resort or have NUCs (non-conforming use) certificates.