What someone "owns" really doesn't indicate their level of wealth because some people have just a couple properties that are 100% paid for and someone else may have 20 that are highly leveraged.

Your statement regarding rent increase indicates you are not a experienced investor.

Financial HealthUnderstand the financial health of the borrower – do you have any indicators that show the deal going bad?

This would indicate to me that you bought it with the intent primarily to resell and then your intent changed to holding for productive use.  

They may be professional tenants, they are defiantly tending that way, in which case the threats are only the beginning of their plan to stop paying rent but it is difficult to say. 5 appliance issues in two months indicates they may be intentionally causing damage.I can only say what I always do and that is M2M leases are far superior protection for both tenant and landlord than any term lease.

You will also volunteer for real estate analysis work but did not indicate the type of work you want/can do.

Regardless, it's now an REO and you should recieve clean title, BUT make sure they indicate you're receiving warranty deed.No, you won't lose your deposit if you bid and lose.  

In my research, many of the experts indicate a higher yield on the lower C-rated properties than on the higher A or B properties. 

A quick scan indicates this is the case in Georgia as well

Your initial post indicates that SFR's that are updated sell in the $280-$400K range.