She also threatened the manager with bodily harm, and had some of her "thug" friends show up at the property to intimidate.

There is work involved to get it to a habitable condition.What price should I start with to offer the bank?

The house is no longer habitable due to the sewer gas (probably). 

The buying opportunities in that period were crazy from other less capitalized/experienced owners at that time, one owner got a failed class A for 1/2 the value to build 5 years later for example.We typically perform very well in down markets, so not to wish harm to anyone, I am excited for the next cycle we’re buying makes much more sense again.  

I mean: you're not purposefully trying to cause harm to anyone else's earning potential. :) Hmm.

I brought up multi family deals for your loan because I look at this house as a deal with more potential to do harm than good.

Position the televisions so that they are out of harms way. 

I know a family friend who has a bad habit of hiring friends who happen to also be "professionals" within their trade.

People will not change spending habits and begin losing the home they have a right to own. 

You don't want to make it a habit, but in this case the broker duped you, so he should expect a re-trade.