You can always go to your bank and have them send a denial letter for the loan, saying that they will not lend you the money due to the property not appraising for the value originally applied for. they then have no case against you and also have to return your earnest money.

Yes and sometimes you can talk to the banks representative that is at the auction and work a deal

Neither is inherently better, foreclosure may take more time because the bank is involved, but if they are both good deals both are fine.

Wanted to check with the community which banks are fairly friendly to investors looking for a HELOC on their primary.   

Issue them a 3 day notice (or equivalent that's required in your state) if they don't pay rent by the time that notice expires evict them.......Problem solved.Also worth noting that a daily fee may be a no go anyway as most jurisdictions limit the amount of late fees that you can collect. $35-$75/mo is a common limit for properties renting for under $1,000.

At first, it was hard to get the banks to take them seriously but now they 3 banks fighting over them to get the loan.

Does anyone have suggestions on which bank(s) or credit union(s) will loan on a home(s) for  $45,000 or under? 

It is a duplex in Westland mi $87500 sale price leveraged through a bank loan that will rent for 850 per side and cash flow very nicely ($250 per unit after all expenses) Im also starting my first flip. its a sfr in Wayne mi. i got this deal through seller financing with no money down (Im kinda proud of that lol).

There is a small risk that if you refinance first and then move it that the bank will call the loan due because of a change in ownership.

Rent Roll, Tenant Ledger, Even Bank Statement) it would show that there is a growing balance (the late fees) or the deposit being made after the due date which should have raised a flag.Unless no reports were sent (unacceptable) or there were not reviewed (also unacceptable), warning signs were visable after 2 or 3 months.Oren