Pretty sure these aren't condo conversions, though I do see that happening in some areas.

If you go back to the conversation with Mr Investor, you should see a "Remove Block" or some such above his replies.

I also mentioned that I am looking for a REO listing agent I can work with and do business with....long story short, it was a great conversation and he had no problems giving me the majority of his inventory along with some prelistings.

It looks and sounds like they will not be, based on conversations with BOA.

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If so and they are shown as a loss, can those loss expenses counterbalance a part of the taxes I would need to pay due to the conversion from a traditional IRA to a ROTH IRA?

No different than owning a condo in a big building with an HOA.Its also possible that someone who owned a triplex did a condo conversion and made the three units into separate legal entities and created and HOA.  

Is there any difficulty in the conversion of that loan into a proper business format?

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