My question is, since we closed on the 11th of August, and the rent had already been paid for the entire month, shouldn't we receive a prorated amount of that rent, after we took ownership?  

People ended up defaulting because they couldn't sell a house for less than they paid for it.

There is no pre-foreclosure list, no probate list, no divorce list, no expired listings list, nothing of the sort.Also, a postcard costs 34 cents to mail in the US?

We paid $77K for it.  

This should all be included in closing documents..Owner give you copy of lease, addendums,  the amount of security deposit plus interest is paid to you within the closing fee's.. any rent is prorated to day of closing and is factored in closing fee's.  

He does know that He won't get paid until we close on a home and he does see the bigger picture, with that said, does anyone have any advice for me that I could give him to motivate him to find these properties without having to get out and drive/bike for dollars everyday other than using the mls.

Is there some service that can provide contact information (name, address) of folks who are currently a 2-3 months late on their mortgage or possibly in a pre-foreclosure situation?  

(What I mean by the "1% Rule" is: 1% gross rent per month obtainable on its CURRENT value - not what was paid).I wouldn't worry that "the banks don't like me buying another primary residence and buying "down in square footage"", UNLESS they they forbid you to follow that path.

We paid about 5k to replaster and retile the waterline of a 25000 gallon pool...blueish quartz plaster mix last year.

We have used it to buy dozens of foreclosures at auction and market to pre-foreclosures.