There may have been better choices for a rental at the time.  

I don't see that the rate of bad behavior is higher among voucher residents.  

It's been extremely underwhelming, not that costly but it's pretty bad. 

Just keep in mind that using that emergency fund to buy your next property and having tapped a HELOC already may leave you in a bad spot if you run into a similar problem again.Also, I’m not 100% sure, but I have heard that personal loans don’t your credit more so than other types of debt so be sure you look into that if you go the personal loans route and then planned to finance your next purchase soon after.

Well, when goes down that's bad for buyers.

So the choice of tenant would be key.On the flip side, reasons to hold: a very low mortgage rate; probably not the case. 

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?

A 1031 exchange is a smart choice for your parents, reducing immediate taxes to $70K (capital gains on $300K boot + $25K depreciation recapture) versus $148K without it.

My bad ,I included the listing in the connection request 🤦‍♂️. 

Quote from @Martin Jones: YouTube gurus will tell you to borrow money from someone else, but that's bad advice for a beginner.