@Kevin Romines Thank you so much for this response.

There are 5 forms you should have signed/received from your Contractor before you start the project:Independent Contractor AgreementScope of Work DocumentPayment ScheduleForm W-9Proof of InsuranceIndependent Contractor AgreementThe Independent Contract Agreement outlines the terms, obligations and responsibilities of both parties to the Contract.  

We are also demmed the condo owner so we are responsible for mainiting any common areas and also have to carry a HOA insurnace.

If you are buying it with the tenant in place, you will get regular homeowner's insurance and then be responsible to evict the current tenant. 

Thank you for your response. 

@Jeff Whelan Yeah it seems @Christopher Phillips didn't understand that you're talking about a house you've taken over the payments on.I'm not sure about lenders in the US but here in Canada if the seller shows them the lease they will only credit 50-75% of the income toward their income for the purpose of DTI calculation.That's probably the best your seller is going to get if you've taken this property over on a lease option.

Our thinking is to do buy and holds in a place where we can pay responsible family to manage it. 

I wrote the above for informational purposes.

As the owner of the home, you are responsible for these costs, no matter what they are or what you want to do with the property.

Father's removal will be a gift to daughter for federal tax purposes and a gift-tax return will need to be filed, and unused lifetime credit will be reduced, or, if already all used, gift tax must be paid.