I just passed my 1yr mark but didn't really start working until my daughter was 2mos old last March and have already been the top listing after within my company for this region 1mo and have had to stop actively looking for new listings because I had more than I could keep up with.  

Who is covered by the insurance policy- trust, mother, daughter, trustee, all?

Otherwise, you may have to make a larger down payment.The FHA considers the following relations to be family members:Child, parent, or grandparentStep-parent or step-grandparentFoster parent or foster grandparentSpouseDomestic partnerAdopted childFoster childBrother, step-brotherSister, step-sisterAunt or uncleSon-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law, or sister-in-lawIf the non-occupying co-borrower isn’t a family member, you’ll have to make a larger down payment.

If not, and this is the best it gets, I'd honestly walk away from this property.My daughter bought a house in Oakland with a hillside behind it. 

I had nicknames for many of my tenants that I only used with my daughter and best friend. 

A story similar to this happened to my daughter. 

I also just purchased another house with my daughters. 

One other thing I forgot to mention is that one of the renters is the previous owners daughter and another one is also related to the previous owners I believe.My thoughts was to raise the rent in Feburary to $950, with a notice that the rent to will go to $1,100 in April. 

An example: my daughter was royally ripped off by a PMC on the $250 maintenance problems they could take care of without calling my daughter. 

Ron and Debbie run the company and have bought a house for their daughter.