Hostile neighbor has an HOA lien.

I would recommend multi family investments over condos mostly because condo HOAs can restrict or even prevent you from renting the space.

Need to be concerned about HOA special assessments.

This, of course, requires you to make enough money to offset all of the PITIA (principal, interest, tax, insurance, HOA dues) on your own and not jointly with their spouse as many people do.

Also, you didn't mention whether ins. includes flood insurance, which would be extra as well as HOA fees.  

It is in an HOA complex that is self managed with 12 units, all townhomes.

I'd avoid condos or anything with an HOA as they can change rules on rentals and you will be paying a lot in condo frees that could go towards a mortgage.If you or your girlfriend are handy, you could buy a place that needs a bit of work that you can do while you live in there.

This is even before you take into account other expenses like insurance, taxes and HOA(assuming there is one).

Should we ask the HOA since the property manager is not helping or wait until the bank gets involved?

Make sure to count in that HOA $$