Higher interest rate means less buyers with commited funding, so less competition and more bargaining chip with seller if your one of the only few that can close on properties.

Sometimes the HOA fees (essential the same as our Body Corporate fees for units here in Oz) can be very high and out weigh any cashflow benefit of the rent.Getting funding can certainly be harder but not impossible. 

That way you could use the money that you would be paying for rent to fund your next deal.  

I will use existing rental income and income from my other business (ice cream shops) to fund the repairs needed.

My desired outcome would be to have them exit the property as fast as possible if they are unable to finalize the sale.2.  

Using funds, or incorrectly collecting funds and not applying them as indicated is particularly illegal. 

If you are both agreeable that she has moved out then take possession and do your turnover work...I would go as far as offering her "fair market value" for her possessions so there is no desire for her to pursue them...then you can trash them or whatever....it sounds like you are self-imposing some unnecessary obstacles...

More importantly what they didn’t know is that on these purchases we use the rent market so if the rent market is higher from the rent borrower paid the whole deal falls apart as only the difference can be applied towards the funds to close.

I noticed that you mentioned using a HELOC on your primary residence to fund this purchase.

Seller will still gets the funds wired to them.Welcome to BP!