Mid Term Rental Tenant Morals over business?

[Hadiya Coppedge]

How do I tell my current tenant that she must move out after she expressed interest in staying?

I operate a 3 bedroom 2.5 bath townhouse as a 3 door MTR with options to rent the entire unit. 

Atm, I have a tenant there with a pending move out of April 1 who asked to stay until 5/27 as they extended their contract. When they asked if their room was available, I told them I had other's interested and for them to let me know if they were able to extend their contract. When I followed up, they informed me they are extending their contract. Their rent does not cover the monthly expenses of the unit. It doesn't even cover the mortgage.  

The problem lies in, I haven't been able to find two other tenants to fill the 2 available bedrooms. I've contacted recruiters, exhausted Finish Finders lead list, and set up my airbnb, but nothing. 

In between hearing from her about extending her contract, a family reached out wanting to rent the entire unit for just under 2x the mortgage. Our talks took about 2 weeks to lead to a deposit between questions, scheduling and every member in the family getting sick. 

For financial purposes, I have to rent the unit to the family to keep me from covering the expenses out of pocket to accommodate the current tenant. 

How do I handle this situation?

My dilemma is, while I didn't verbally agree to extend the contract with the current tenant, I didn't say no either. I informed them others were interested and that I would talk with them a week ago about a potential tenant. I believe my mistake was not being transparent from the beginning once I knew the family was interested? 

What do I say to my current tenant during our conversation about moving out? What do I frame the conversation? What do I include and not include? 

What I don't want to happen is they leave me a bad review on FF.