The S&L said no more I took my list of houses to a local bank and they gave me a line of credit.

You have to weigh those factors against all the good advice you've gotten here, and make your decision based on bottom line, not emotions. 

And for the bed/bath combo we want we can't find a place with a lower or similar monthly payments.

Since the first applicant in line was chosen, I wanted to let them know that the specific unit they applied for isn't available, but we may have another unit coming up in the near future.

I assume your agent ran the CMA on the property and if so, did you guys did compare it with other 3 bed rooms, 1 baths in the area? 

I've got a list of 10 banks im calling today to try to get a line of credit on a leveraged rental property!

With all the new apartments coming on line vacancy rates will most likely dip for a period of time

You are putting a lot on the line with that statement, you sure you don't want to edit. :) .

How mature is her project plan and does she have sub contractors lined up?

Where do you draw the line?