I spent 30+ years in Washington State and have had some involvement with DSHS (although not with housing).My advice to you: 1) Everything the state does takes three times as long as it should and three times as much paperwork as it should.  2)  You will probably have to attend some indoctrination -- I mean class -- either on-line or in person.  3) Your tenant will be endlessly "educated" on their rights and will have free legal representation. 4 ) Just when you think you know the rules and try to play by them, an administrator will come up with an "ETR" -- Exception to Rule. 

I have a deal lined up but I am having a hard time finding a investor friendly escrow/title company or closing agent/attorney.

Sure enough, there was a distinct water line on all of the walls of the basement and everything else down there, which we now know is why the boiler and water heaters had rust on them. 

@Tom Gimer  if the bid increase it goes to the owner of the property or next in line if their are junior liens bank cant keep anymore than what they are owed..

They have never required me to own the property, since in order to close on a mortgage you need to already have insurance lined up for the property.  

We have limited space as it’s a couple effeciency apartments mixed with other one beds and a potential 2 bed.

Each state has it' own insurance commissioner.You probably heard this hullabaloo about selling insurance across state lines to lower costs of Obamacare.

Do you have a title company lined up to close an assignment transaction?

Of course, it also depends on how negative you're talking about - but think about that negative number as your new rent payment - is it in line with what you could rent a similar place for, or is it cheaper?

Have another 2 one-bed condo in escrow closing in December 2017.