Need Advice on what to do next- nightmare property

[Brad Clarizio]

Hi folks,

I had a very unique situation happen to me and truthfully, I'm unsure where to take it next.

3 years ago, in October of 2012, I bought a duplex in South Linden (bad area) of Columbus, Ohio for $16,000 cash. It was my 3rd property and the idea of owning a duplex was so exciting to my 22 year old self, I simply couldn't refuse. Unfortunately, like many young investors, I let me excitement blind me and I bought the property site unseen...you can see where I'm going. 

Long story short, my insurance wouldn't cover the property because it had a slate roof (State Farm), and they required me to replace it all. I could not afford that at the time, so I made the decision to sign the property over to my property manager who was looking to obtain a rental, and I had a mortgage note put on it where he agreed to pay me $400/month for 54 months, including interest (I believe we agreed on 3.25%). 

Fast forward to this past December (2014), he filed bankruptcy and did not put the house in his filings, but he had to surrender it. Currently, there are people living there, he is not collecting rent (or so he says), and I have not received a payment in nearly a year. He indicated that any time I want the house back, he'll sign the deed back to me and it's mine, free and clear. My dilemma? I want don't want the house. Bad area, bad situation. The house is in decent shape, but will need 10-15k worth of work for it to be up to my standards. In another year, the house becomes mine anyway when the bankruptcy is finalized, so I'm stuck. 

To me, my options are:

Donate the property to the city and take the tax write off

Sell the property to a wholesaler for 4-6k

Take the property back, invest 10-15k in a house that's only worth 20-25k to begin with and hold it for awhile

Fight this in court to get him to pay me back for it as part of the bankruptcy or garnishment

Looking for advice- what I want is out- if there's an option for me to recoup some cash without a huge investment, I'm interested in that as well.

Thoughts?