If that doesn't work then meet with the tenants after the sale and go through the lease, be nice and professional, and let them know you are going to improve things but be firm on the terms of the lease. 

Best way to improve on losses is to supplement your income by house-hacking. 

I know logic says that they can’t take a House for free, but I cannot find any info or wording regarding paying back a new owner.They always say you cannot sell such a property within 120 days because title won’t insure it, but I wasn’t sure if that was only because the possibility of a redemption for the auction price, or if there was some rule or law that made a transfer illegal or a very bad idea.

Has anyone gone through trial without getting a ruling on the same day?

I would love an open dialogue with someone who has done it, tried doing it, or thought about doing it, that can help us both improve.

"What should I do to improve my position with my 40k in equity that has income with out a time constrant?"...............

You must know all the rules and don't get upset when sometimes you mistake and pay few $$ because you forgot about expiration of 0% Right now, business credit cards give me 0% till March 2020 and with only 1.99% fees upfront while personal cards only for 12 month and 3-4% upfront.This is long term game and ideally you have to have 4+ eastanlished credit lines with different use - revolving and installment, for more than 7 years - never be late - then you'll reach to 850 FICO.Plus few other tricks - but it's alittle bit personal

I had discussed the rules about what goes in the toilet when we signed the lease.

Arbitrary rules with harsh enforcement on your units, no enforcement on his own, for example. 

No depreciation and too many rules.