(b) Leases or rents or offers to lease or rent, or places for rent, or solicits listings of places for rent, or solicits for prospective tenants, or negotiates the sale, purchase or exchanges of leases on real property, or on a business opportunity, or collects rents from real property, or improvements thereon, or from business opportunities. 

I spoke to the appraiser who appraised my building 2 years ago when I was first going through the purchase transaction and he states that too many banks have been burned on using the cost approach with people paying too much or over-improving their investments which has caused most people in the industry to only use sales and income approaches to properly appraise a property.

Talk to them first, but raise rent to market rent, background screen, credit check, and offer lease.

Your actionable steps in this order: Fix your credit, get out of debt. 

The best part of the deal was the owners covered the closing costs and where able to do a sellers finance credit (I believe thats what its called ) for $5,000.

I will check with my credit union. 

I am starting out with around $50,000 to invest (also great credit score and cosigners if needed) and can probably find some decent homes here in Lexington that I could buy and flip in that price range but not so much in Colorado.

The seller avoids foreclosure and walks away with his credit more or less intact, his mortgage paid off, and $15k in his pocket to start a new life.3.

Credit them the few days back off of rent.Sorry you are facing this and wish you well either way!

Because of the way it will be valued means you will get 3 or 4 times the money spent on cost to improve.