It's not a pleasant process, and should be avoided if possible. 

My recommendation is usually to keep each property in a different LLC to avoid comingling assets and therefore risks to those assets, and to contact your insurance provider in order to ensure the LLC is an insured party under the policy.

2) there will be a decent amount of money owed for the arrears on the loan to bring it current, to avoid foreclosure.

To avoid legal I just sold out my shares.

Any chance you can speak more to why you would avoid joint tenancy or tenancy in common? 

@Ryan Ribinskas I would sell the house now and avoid paying capital gains tax, since you have lived there 2 out of the past 5 years. 

The tenant is interested in purchasing and I may give them the option since I've owned it for 2 years and I wouldn't have short term gains on it and I can avoid using any agents.

If you inherit a property there is a step up in tax basis and no capital gains tax or depreciation recapture if you sell the property for same market value as valued when inherited  Any gain occurring after inherited date can be avoided by doing a 1031 exchange.

No way to avoid the down payment on multifamily, that I am aware of

I know general investor mentality is to avoid it at all costs.