At the worst, I have had tenants who painted several rooms of a house without obtaining permission as required, and they chose bad colors or combinations that had to be dealt with when the house was put up for sale.

The proof you need to remove this condition from harming your loan approval will be to prove that you were "not," obligated on this debt that is current going through a modification or shortsale.I saw that you mentioned "currently going through modification or shortsale," if they find that you're obligated on this note/debt then your loan may be shot depending on what the verfication of this mortgage comes back with.Here are the steps the underwriter will probably ask for:- ask for mortgage note to see if you're obligated on this debt- run title profile or obtain a title report to see if you're on title- then run a VOM (verification of mortgage) to see what the mortgage rating and payment history has been on this mortgage (if you're obligated)- update the file accordingly and run the file through the current guidelines to see if you still qualify

Agreed, although most of those items can be obtained through automated methods.The past landlord, and possibly the employment verification (some information may be on a credit report) usually take the longest. 

Once your business is registered, you must obtain business licenses and permits.

I came out of the deal with 15k in equity but in the process I ran into a lot of unforseen issues that resulted in me maxing out my credit cards just to obtain the occupancy permit and to start prepping the house for resale.  

The rents do seem on the low sideBased on your situation it is going to be very difficult for your to obtain financing with only 20K down. 

So lets say you obtain the lien certificate after the redemption period (1 year) and you haven't been paid back ( more than likely they will) you have the right to foreclose on the property.

I've just sent out my mailings that I obtained from List Source and I feel great; just accomplishing that small feat gives me a boost of confidence, very optimistic.

-If licensing is required, will a regular RE agent salesperson license suffice or does one obtain a Brokers license (lengthy application period)?

If you are trying to obtain conventional or normal financing, you have to account for every dollar.