Granted there is a cost in hiring an agent, Having someone analyze each deal with localized knowledge is worth its weight in gold.

Quote from @Jeff Sanders: Personally coming from an agent/investor in CA, I always get a quote from a broker of mine and make sure I am knowledgeable with the fees/costs.

Never thought about it but that is clearly a key piece of knowledge that can come in handy whenever needed.

Lots of good choices! 

Learning the ins and outs while keeping an eye out for a great deal is a smart approach—knowledge and patience go a long way in this space.

They are knowledgable in their space, but I find them on the pricey side.

You also want someone or a group that are not only knowledgeable but are timely & have good communication skills.

Investors will want to work with you if you are knowledgeable, can find deals and have connection with vendors.

Should it simply be one of two choices: deny application or accept application with ESA exemption even if the property qualifies for the FHA exemption?

To me at my current knowledge level, this deal only works if taking over the loan - to limit the out of pocket money to acquire the property since the outside reno and new septic would take up the bulk of rehab costs.