put 5k to clean it up and rented out right awayLessons learned?

Additional prior to move-in deposits: Cleaning Deposit $400.

It needs to be moved cleaned out after the previous tenant. 

For $45/month, you get $5,000 in rental coverage for things like missed rent, excessive damage, excessive cleaning, pet damage, and eviction costs.

Compare that to your offered purchase price and surely it would be more profitable for him to wipe his hands clean and let you take over.

We cleaned it up, sealed any holes we could see and went on with renting it out. 

You can probably find basics of these forms online and then have a local attorney clean them up and make them compliant for your state (or the lawyer could draft them although they'd be a bit more expensive).

Just a little landscaping and cleaning goes a long way.3.

This is called a Deed in Lieu Foreclosure or Deed in Lieu (DIL).As an option to avoid a long drawn-out foreclosure process (more painful for the lender than the borrower), your friend might be able to negotiate a deal with her lender to accept the property and wipe the slate clean.

New LVP flooring upstairs to replace all the carpet, new cabinets and countertops in the 2.5 bathrooms, new fiberglass shower in the guest bathroom, new walk in shower (tiled) in the master bathroom, next lights/sinks/faucets/toilets/etc in all bathrooms, new paint on kitchen cabinets, new pulls on kitchen cabinets, new ceiling fans throughout, and fresh paint throughout.