@Csilla Veress A couple of books that may help with understanding PV (present value) calculations, as well as note investing in general, are:Invest in Debt by Jimmy NapierPaper Profits by @Joshua Andrews  (my personal favorite)This blog post by @Mike Hartzog may also be helpful:https://www.biggerpockets.com/blogs/5359/41924-doi...PV is the way most note investors do pricing for performing notes, but for non-performing, you'll want to build an ROI calculator as  @Chris Seveney suggested so you can look at various exit scenarios and take into account costs like servicing, legal fees, insurance, etc. 

I want and will be in compliance to the fullest extent of the law, but to be truthfully honest, I dont want to go any further for this particular renter than what I am legally supposed to do and I want to be ready if the late night plumbing call comes and I am on vacation.

Have you been approved and seen the home yet?

Your situation depends on your involvement, your entity selection, and lots of other factors that preclude an informed opinion.3) You didn't ask, but I offer that you should not take or act on any legal, regulatory, or financial advice on a free forum and always seek a professional opinion or two.  

Would I have to be pre-approved for a loan before I show up to one of these live auctions or do most buyers use a cashiers check or etc.

Question - Do I legally have to allow this pet? 

At the very least your insurance company could help with legal council if an issue were to arise.

Keep in mind I am a new investor looking for guidance but I have a general idea of what I am going to do and have already been approved for financing.  

Wholesaling scares the heck out of me; is that a legal process that a licensed agent can engage in? 

The traditional lender won't approve this property because it has two houses even though my buyer wants to live in one, I guess they see it as an investment property.