Power of attorney? Purchase MIL's house? Sub2? Help!

[Troy Sheets]

My mother-in-law wants out of her house. It's in the NE part of Philadelphia, right off Grant and Bustleton for those that know the area. I'd say her particular neighborhood has gone down a bit in recent years with a bit of riff-raff moving in. The neighborhood just isn't as well-kept as it used to be. Her house is worth probably $120k as-is (needs cosmetics), she owes ~$130k, and ARV is $135k at best. Her PITI is ~$900/month and rents in the area are $1150-$1200 or so. She's not interested (or capable) of renting it out herself. She's having some health concerns and is moving in with a relative. The last thing I want her to do is walk away from it but she's that desperate. She doesn't have money to come to closing to unload it either. She's basically out of the house now, still has stuff in it but isn't living there. She isn't behind yet, but I could see her discontinuing payments in the very near future. She has pretty good credit so I'd hate to see her wreck it with a short sale or, worse yet, a foreclosure.

I've looked at the HAFA Program, but to try and help her, I'm sure I'll need to get a power of attorney to deal with her mortgage company. She's not able to deal with any of this so, if I want to help her, it's up to me and my wife. How do you get permission to deal with the mortgage company? Can I call them and they'll send a form for her to sign? Will a standard limited power of attorney form work? 

Lastly, if she's not eligible for any of the above (she has a decent pension and SS, just no assets), is it worth me taking her property over subject-to and renting it out? I know some investors do sub2 of negative equity homes and rent or resell with owner financing, it's not something I've ever done or considered (till now) but it may be an easy way out for her. I would rent it out if I took it over sub2. Does it make any sense to take on a negative equity property with a small spread like that? 

Any thoughts on this mess? Any other angles or programs I should look at? I don't have a lot of hope that the HAFA program will work for her due to sufficient income and her health issues likely being hard to diagnose/prove. 

Thank you for any thoughts or advice up front, I feel like I'm too close to this to see it clearly, if that makes any sense...