He said that I would win in Court if I take my borrower to foreclosure.In order to "cure" the Title a new foreclosure must be done.  

If things aren't corrected in a few days, then hit her with the cure or quit notice and prepare for the eviction. 

Hopefully the carrier will pick up the defense bill.Smoke/fire damage can take longer to fix because you have to do more to cure, so terminating the lease is probably the safe route, even without danger of suit. 

Answer me this..When you are bitten by a crazy infected chicken, are you going to plant your butt next to the mail box hoping someone will send you a DMM offering curing crazy chicken rabies? 

Again, you need some better PM resources, that's the underlying issue here, fixing 1 symptom will not cure the disease so to say. 

If you do document evidence of lease violations, send notice and opportunity to cure per lease and statute. 

The best solution for where your at is also the cure for all the problems you have experienced from day 1, you need a REI Pro to advise and consult for you in all of this.

Exchanges are great for tons of reasons, but they aren't a cure all and they come with some drawbacks.  1031 rules limit what you can buy, when you can buy, how much you should spend, how you treat the replacement asset, etc. 

Remember that the tax deed auction you buy the rights to foreclose on the deed and any interest or fees the county collects if the owner doesn't pay within the cure period.

If you did the inspection and observed something that lead you to believe other people were living there, you could issue a notice to cure.