Thanks for the feedback—it really makes me step back and think about this whole situation.To answer your question about the hard money loan: I went that route because I needed to close quickly, and hard money was the fastest way to secure the deal.

I specialize In helping investors like yourself locate, and secure investment properties and provide a hands off experience along the way.

Unless the medical condition meets the state criteria for early termination and that the medical notice does not appear to suggest that, you cannot terminate the lease outright/immediately but that you will begin to market the property for rental and upon securing an acceptable tenant, the lease can be terminated pending a satisfactory property walkthrough indicating no damages. 

You are not a borrower, you are not liable for the debt, you may need to sign the security instrument to allow the mortgage to be recorded, but this does not change the above statements.

Streamline your communication process to secure quality tenants.Focus on QualityThe condition of your property matters more now than ever.

Do you best to not file insurance claims.

Corp of engineers, DNR, Soil/Water boards/City-County Engineer- you will need to file with one of these possibly. 

Provide clear instructions on where and how to pay to avoid confusion.Recover Security Deposits: The current property manager is legally obligated to transfer tenant security deposits to you or the new management company.

The law does NOT apply to landlords:With less then 5 rental unitsThat live in one unit of a duplex and rent out the other unitThat rent out rooms in the home they occupySo, landlords can no longer state in their rental ads, "Section 8 not accepted".The reverse is also true, "Section 8 only", cannot be used.We've always recommended screening S8 tenants the same way as cash-paying tenants.Landlords waiving application fees and/or security deposits only for S8 prospects may also be violating Fair Housing.

If you can purchase this home with private money or seller financing and get a $110k loan, then you could do a rate/term refi right after so do a 90 or 120 day note to secure the property and get it in your name, then refi into long term debt using the full appraised value.