Easy solution: get licensed.

Home insurance won't cover a lot of system failures like electrical.Home warranties are designed to make the warranty provider money; they are slow to respond, quick to reject claims, charge you a trip fee for every visit, use the lowest-cost vendors that provide quick-fix solutions, and are generally not worth the paper they are written on.

The only options that seem available to us are add the parents to our application, remove either parents or wife from the duplex, or in the future put the rents all in my wife's name which might negatively affect my in-laws.You guys are my Hail Mary, hoping you can spot a solution I'm missing!

You could reach out to an eviction company like Landlord Solutions, Inc to assist with this process if it comes to that.- Consider a Cash-for-Keys Agreement: To avoid the lengthy eviction process, you might offer the female tenant an incentive to leave, known as a “cash-for-keys” agreement.

., they have re-zoned my property as residential/commercial use which evidently was their solution for people not getting the permits but puts me into an entirely different tax structure. 

Big problems call for big solutions & commercial conversion is a great solution for workforce housing in resort areas.

A few ideas:* If you KNOW every home inspector on earth will find the issue you could state it up front in the agent MLS notes with the proposed solution / cost to fix.

At that point, it's worth researching and finding a solution that better meets your needs.

Explore short-term solutions with hard money lenders and plan to refinance later. 

ALE Solutions is the one we've used the most.