As a result, if that carrier goes under and is unable to pay claims, the state is not required to backstop the policy.

Insurance would cover it, I would pay the deductible, and no assets would be lost.If you are in an area like San Diego where people are more likely to sue, a judge is more likely to find you guilty, and the payout is expected to be higher, you may consider an umbrella insurance policy.

It has a lot of features that I simply can't write down all together.Zoho SalesIQ it integrates with your websites for real time chat supportZoho Workdrive, this is a Google Drive alternative except Zoho gives you 5 TBs right of the bat!

Im thinking about paying the bank the 50lk that we owe and the taxes.

You then will pay some long term capital gains, but you also have to take depreciation recapture. 

Meanwhile, bank money market paying 7.5%. 

If you simply go to your meetups and let folks know your a private lender you can sift through the deals and cherry pick them.

Some PMC's will charge a lower percentage fee, but will charge it whether tenant paying or not.

My plan is to buy the house subject to their existing mortgage, renovate the property, refinance it and pay off their remaining loan balance using the money from the cash out refinance.

If you gave the keys back to the bank  they simply would never deal with you again and I see that today even after 10 to 15 years from when it happened.