Mike:CAP rate is really not applicable to residential properties (1-4 units) as they are not valued based upon fiscal performance.

Number of beds/baths, acreage, sufficient room for parking, quality of neighborhood, signs of construction in surrounding area, and many more factors.Something I have enjoyed doing while starting out, is rather than driving around to every house on the MLS...take a quick look at the property on Google Street View and run hypothetical numbers on the projected performance of the investment.

Best case, it re-performs and you make 60-90%.This also doesn't count arrears which I can demand to be paid, or use as negotiation.Also, if the property is in a state where I can do a Forebearance agreement with deed in lieu I can get cashed out faster and save some cost.

Also, instead of a full lawsuit to force her to sell, can I simply place a lien on her house to simply recover for my costs with the appraisal & attorney feesThxIf the cost of removal of violations required to be removed by the Seller pursuant to the printed provisions of this Contract of Sale shall be in excess of five hundred ($500􀀉 00) doll􀀄􀀅s, the Seller is hereby granted the option to withdraw from this Contract of Sale, in which event the Seller shall refund to the Purchaser the monies paid on execution hereof, together with the net cost of exa􀀊ination of title and any survey actually incurred by the Purchaser, not exceeding rates usually charged by any major title company where no policy is issued and where title shall fail to close; whereupon this Contract of Sale shall become null and void without any further liability on either par􀀁y to the other unless the Purchaser shall agree to take title subject to said violations and assume the performance thereof and receive an abatement in reduction of the purchase price in the sum of five hundred ($500􀀂00) dollars􀀂 The options herein granted shall be exercised by notice in 􀀋riting by certified mail, return receipt requested􀀃

Once a note is performing.

As @Zach Mitchell mentioned above you certainly could get an actual appraisal performed on the property  however unless you have it under contract just review the comparables that resemble subject project and have sold in the last 6 months. 

All the work performed was done by an insured and licensed GC. 

As to the "all remedies allowed by law".....generally for a buyer to have the rignt of specific performance,  it must specifically be spelled out in the contract.  

Is past performance indicative of future results?

I am interested in how they are performing.