No 1.75% funding fee so conventional loans typically have less closing costs.

It is just a reality how many PMs have no idea how to process claims and have close to 0 systems to protect assets for business owners. 

If you need financial help, ask under the "Finance, Tax, and Legal" forum.

I decided to buy the property from my grandfather using a gift of equity, which allowed me to take over ownership without having to come up with the full down payment and pay for the tax lien and his closing costs.

@Laurens Van swol a few banks that we've worked with in the past allow you to close in your personal name.

Secluded in the woods, but still close enough to town.How did you find this deal and how did you negotiate it?

This is both a legal and tax question. 

Despite the guru fed “misinformation” about all these under market price deals, they are actually very rare and require (1) the investor recognizing value that the seller and the rest of the market misses or (2) a seller with a need for an immediate sale and a buyer with the CASH immediately available to conclude a very quick closing usually forgoing inspections, financing, and other contingencies. 

Alternative is the sherif evicts him and I pay tax and insurance.I know we can have a gentleman's agreement on these things, but im still afraid he might be able to legally sue me if we have a legitimate residential lease?

Any ploy, tricks and legalities.