An identical property a few houses down sold for 118k in 2015.  

Listing price is $185,000, CMA revealed 4 identical 4plexes that closed for this price in the last 1.5 years.

Not without committing fraud - Owner occupied loans require you to occupy the premises for a given period of time. 

Mortgage Fraud.

I received a late payment from a tenant on the 14th with late payment and started telling me about how his wife's identity was stolen and their accounts were frozen.

In the states that require NMLS registration and MLO licensing, AZ is one, if they are not registered with NMLS and licensed with AZ, they are not compliant and I would be very suspect of fraud and particularly advance fees loan scams.

Tenant who left was paying $1,250 per month and so is another tenants in an identical unit. 

@Jabri Carter I was going to post a comment but it would be identical to what @Yany Rivera already stated.  

If I issued a $200k loan on an investment property expected to command $200/month in rent for someone with no other income besides that $200/month, it would likely be called predatory lending and I would lose my license because I probably would have had to commit fraud to close it. 

If rates go up to 7% on 30 year fixed loans, the selling price of a loan @ 7% on the secondary market will actually be identical to a loan of the same amount at 4% when 4% was prevailing (yup we don't care about your rate, only where it is relative to what fannie will pay for it).