With my low-income being a student I wouldn't get approved for a decent mortgage from a bank, so my question is:Who are the best lenders that would approve me for a mortgage?

Problem is the area is one I don't like, bleak job growth, low class, challenging tenant pool and needs really good, strict management.

I have noticed some potential low cost rental properties in my area for purchase.

The real reason was long-term low interest rates.

If they stay low a long time and you take the money you save and use it to pay down the principal, you may have made an excellent choice.My opinion is most people are better off with fixed rate loans.

 $42,000 is not all that bad, I see some comps where other investors are buying from providers I have never heard of in the mid 50's ' low 60's.  

Or did I do the right thing by lowing my offer due to the work it needed.

The quality in this resource is astounding.

Agents are usually not investors, so they just think investors make low ball offers. 

I agree with the previous poster: The sooner you can move up into >5 units, the better....UNLESS you want to use FHA/Fannie/Freddie financing (low down payment), or unless you want to live in one of the units.