I am planning to speak to the professional who checked out this particular home.

If it's your first, but you're thinking of doing it regularly I'd advise treating it like a business and talking to both a lawyer and a CPA as it may be advantageous for you to form an entity or to open an IRA if you don't already have one for the purpose if it best fits your particular situation.

Seems like the best and smartest option (by far) to me, and it's at least worth doing some research on to see if it makes sense for your particular situation.  

In no particular order I have listed some of the most popular markets for out of state investorsCleveland, OhioDayton, OhioToledo, OhioYoungstown, OhioCincinnati, OhioMemphis, TennesseeBirmingham, AlabamaKansas City, MissouriSaint Louis, MissouriIndianapolis, IndianaDetroit, MichiganErie, PennsylvaniaLouisville, KentuckyMilwaukee, WisconsinJackson, MississippiEach of these markets is popular with turnkey investors because of the low barrier to entry, high rental demand & high rent to price ratio.

On this particular report, I chose to go with the lowest interest rate offered by one particular lender, 2.5%(buy down with points I guess), 15-year loan.

Rather than fishing for ideas for your particular situation on the public forum (some of the feedback you'll get will be wrong), you should get one on one with knowledgeable tax expert who can analyze your situation and provide you with proper guidance. 

For their area, they analyzed a number of rehabs that a particular team had done, then estimated the cost of rehabs per square foot after they completed the projects. 

My parents do also plan to remidiate the mold issue but no longer want to deal with these particular tenants.

There are plenty of ways to profit through real estate investing that don't involve this particular risk, and there's nothing right or wrong about any particular path to wealth through real estate.

What I'm saying about these particular people you're dealing with, is at least they're being transparent about the property value and why they're charging more than market value - I find that to be rare and admirable in this business - maybe you think it's shady.