It's recommended to discuss with an attorney knowledgeable in your state laws to determine the benefit and best structure for your situation. 

Umbrella insurance is usually a very large policy of $1 million or more, extending your coverage for larger situations.

you need to dodge capital gains and foreign buyer tax.. you should consult a tax expert..If I was in this situation I would just sell (not advice) and buy a cash flowing mobile home park in the midwest

Any other questions about my situation let me know.

That said, the other agent and I frequently reduce our commissions on these deals to make them work and, even if the agents don't, the seller would still be getting around 3% at closing with a 10% down payment which, to me, could be a win-win depending on their situation.  

Josh I find myself essentially in the same situation and I have been thinking about my options.  

I tend to lean toward my clients getting some experience owning a standalone rental property prior to buying a live-in multiunit, but at the end of the day, every situation is different. 

I might suggest getting your own appraisal where you select the appraiser that knows your situation and you can talk to and discuss their approach.

By your description of the situation, I thought that might be in. 

Take people's advice and also dont take people's advice, make a decision that best fits your situation.