In general, once you sell the house you are no longer liable unless some sort of fraud or law was broken while you owned it. 

You have two identical homes, model matches with same size lot, same size square feet, same bed bath count.

The bastard relented only after I threatened him with federal prosecution on charges of committing mail and wire fraud. 

Anything else is likely mortgage fraud or wreckless from a personal finance perspective

The Statute of Frauds requires that all contracts to buy or sell real estate be in writing.That said, I'd expect any real estate agent to know that, so I'd be very surprised if there actually wasn't a contract of some sort.Have her tell the agent in writing/email that she wants out and request a prompt refund of the deposit.  

The builders of this house built two identical houses adjacent to it, the house that is higher up has a slightly obstructed oceanview however the builders/sellers have the perception that higher is better even though competing buyers all prefer the house that we have an offer accepted on.

I am looking at a foreclosure auction and the bank took control because there was law fraud involved.

Using an owner-occupied loan when you don’t intend to live in the property is mortgage fraud.

I feel they are crossing two big lines: 1) trying to misrepresent my finances (mortgage fraud?)

What are the pros and cons of operating your STR as a person vs. a tax ID entity.