By adding two ADUs I'm essentially getting four-plex returns for the mortgage payment of a duplex.

you will have to sign the banks paperwork that will say you have honestly disclosed your assets and obligations.

2) Since the tenant signed an agreement that voided the contract, is there an easier way to get them out since essentially the contract is void at the end of the month?  

I'm a little apprehensive since I've never done a construction loan or worked with contractors to essentially rebuild a house.

Usually they keep up with market rent and there is more paperwork and inspections involved but that keeps your property up to par and direct deposit is nice.

My question is what are a few essentials that you look for in a seller finance contract that protect both the buyer and seller.

The idea behind house hacking is to have income (rent) cover all expenses so that you're essentially living for "free."  

Essentially saying that the tenants can either accept the market rents (increase to $950/mo) or end their month-to-month since you plan on renovating the units.

A hard money loan would be best if the auction is only 10 days away, if you don't have the cash on hand.Another option that is a bit more of a "nuke it from orbit" option, is for the seller to start the paperwork for bankruptcy.

Essentially, your rate and term do not change, only the payment due to a sizeable paydown of principle.