The loan is conventional and they are asking for Employment Verification saying I work remote in order to settle the occupancy rule. 

Things settled down.

There could potentially be an option for the heirs to assume the mortgage when the estate is settled.

I settled on one that was in state but about 2 hours away from me.

After that, the attorney can get the father to settle by releasing any interest he has in the property.  

If I just sell with no 1031, I have the funds to invest right away in alternative asset classes but  have to set some aside for settling capital gains tax and depreciation recapture when filing taxes next year.

That is just to say, when the need arises “I don’t settle, I fight”.

I need help identifying my real options as at this point I only see two: 1) fight it and settle for 5-10 percent increase which is my goal.

You're going to attract tenants that have no place else to go, and therefore they "settle" for what they can get. 

Finally, another offer and another nit-picky list of non consequential stuff to fix (including a small tear in a window screen and a front step that had settled and was now 1/4 inch lower and out of compliance)!