She wants to remain primary responsible for rent. 

That remains to be seen. 

This has been my experience so far:I have been working with my mortgage lender for over a year now and she does a lot of work with a certain real estate agent (who will remain nameless) and she was really persistent that I use her as my real estate agent. 

Regardless of price point you should remain consistent with the other houses in the neighborhood.

So would tenant need to pay upfront, next month the remaining 25 for last month and also 25 for security so next month rent would be 1075 or how do you do it?

while interest rates remain low, the days of quick-and-easy financing are over, and the tightened credit market can make it tough to secure loans for investment properties.

@Joshua Dorkin HI Jarrod,Your concern seems to have two parts:1) DTI - debt to income qualification issue - you can either bring on a spouse for more income, rent out the prior house to create income to offest the prior home's payment, or other strategies2) VA eligibility for second and subsequent use --  If you're in a 417k limit area and you use 262 then that approximately means you'll have 155k or percentage use of the VA entitlement remaining. 155k / 417k limit or about 37.17% of a county's entitlement left.

This is truly a case of the house is too big - she doesn't want to be a landlord anymore (although she rented the apartment for 25 years and never had more than 2 months of vacancy and never had one eviction) Doesn't want to deal with landscapers and plow guys to maintenance the house.I guess the question remains how do I bring this up to her children - how will it work if the note lives longer than grandma.  

All certificates of purchase held by other parties remain in place.

Mostly value add remaining properties left now.