If you are wanting to BRRR, then you can use your heloc to purchase and rehab a property or a combination of that and hard money to find a duplex.I work with a bank that will Cash out refinance once a tenant is placed and will lend based off of the asset and income production, not based of my debt to income ratio.

Who else should I be contacting to see if we can obtain these properties if there is no next of kin? 

HELOCS are sometimes harder to obtain, but they are offered up to 90% now in FL, maybe 95% in some states for highly qualified borrowers.However, you can minimize having to sink so much money into "Dead Equity"  by looking at 85% Investment Property mortgages AND where so many so called "Experienced investors" fumble the ball when using a purchase loan is to take advantage of negotiating  'Seller Concessions/ Credit" in the sales price to pay closing costs. 

The appraisal and credit report -- I assume they were obtained in order to obtain a mortgage?

The fact that both of the tenants also have felonies is concerning as well.I do rent to tenants with dogs but I require that they submit proof that the dog has been spayed and neutered and that they obtain renters insurance which covers the dog.

They deal with hundreds of assets at a time and will have a staff of people to manage and market the properties.

well first off this being a landlord site.. and a positive cash flow site generally speaking.. most will tell you are nuts to buy this.however if you can get the property to just about break even maybe lose 100 a month or so and you have a prime Socal asset that someone else is paying off your mortgage and you think rents can go up a little.and you can EAISLY self manage based on quality of the unit .. incredible tight rental market.. that mitigates a lot of land lord issues.I mean whats the alternative you go 1000 miles away to make 100 or 200 a month.. is that positive cash flow going to change your life..is 100 a month negative going to change your life.now this is an extreme.. but i owned a home in Palo Alto that i chose to sell back in 91 because it would have been 300 a month negative.. well that negative within 36 months would have been positive.. and i sold for 500k and today that home is worth 3 million.... and once it got positive it probably would have been positive up to 2 to 3k a month coming into the 2010's.... and someone else would have paid for my home.. plus grade A tenants at all times.. being prime Palo Alto.so thats one extreme.. its really only in low to no appreciating markets with tougher tenant bases that turn a bunch that positive cash flow becomes more acute or for those that want to one day live on their cash flow and be in the business of landlording.. thereby acquiring 50 to 100 doors. 

Also is it true that I can make up the low yield by growing the rental units thru refinancing as total income or asset value increases?

These programs are much more lenient and allow Alternative income streams to qualify such as: Liquid Asset calculations for incomeBusiness Bank DepositsPersonal Bank Deposits Expected Income New Employment income1099 IncomeCommissions & BonusesAccount ReceivablesNote Receivables Contracts for future incomeNew Rental IncomeExpected Rental Income from property planning to rentConsiderably different calculations on Tax returns 

To me, the idea of LLCs is business smart because it not only protects personal from business assets (as well as one asset from another), but really spells out the expectations in the operating agreement and, possibly, a subscription agreement if there are multiple investors.Feel free to reach out to me or members of my team if you want to learn more.