From the sounds of it I bet there are other things wrong too.

I'd bet that a google search would find out if the same were true in CA.

I have been listening to Podcasts, reading Rich Dad Poor Dad (since every podcasts recommends it), and looking at listing on the various Real Estate sights.  

Your best bet is o sell your house, with hopefully an extended sale date, and a rock solid buyer.  

Prices in GP and Alberta still have room to drop, and you definitely should include expenses for CAPEX and Property Management just in case, which means your cash flow will be near 0.Basically if you are CF zero, you are betting on the market to go up for your increase, and it is not likely the market will do so for another year or more.I would say wait for the market to drop a little more or find a different market with lower prices and potential for better cash flow.

Have those cash reserves ready so when we hit another bump you can clean up on those people that made poor decisions.

Their appraisal will, of necessity, contain a selection of properties in your area in degrees of repair from poor to great.

The other tenant credit is very poor.  

If anyone knows if it can be done on either a conventional loan, fha loan for a triplex, or would a portfolio lender be the best bet?  

That seems like poor decision making on the banks part given the LTV.