Their rent helps pay your mortgage and build your savings. 

I rather not go to court because I will have to pay for a lawyer.

Grandmother had demetia (later Alzheimers) and focus of family was on her care and so house kinda was forgotten and home deteriorated.

to give some feedback, you will need to estimate the cost to repair the house; if you don't know how to do that, we just need some  information of what the house needs and the sqft of the propertyIf the house is, as an example, 2500 sqft, and It looks like you are stuck in time back in the 1980s, but the AC is working,  the roof is ok, and there are no foundation, plumbing, or electrical issues; I can assume maybe a $20 per sqft, so the rehab is about $50K to 60KIf the ARV is 290K minus 10% closing/holding costs, - minus 20% profit - $50K rehab, ideally, in this example, I need to buy the house for about $150K to flip it, but as a landlord, I may be able to pay a bit more, as long as rehab is not too much, and rental is about $3,000 to $3,500 a month

Not too low either, you don't want to go with someone who is just focused on price as this is a quality of a not-so-great accountant.

I love that you rented two of your bedrooms as mid term and short term rentals and made enough to pay for the mortgage and now you are going to use the rental income to show you can qualify for another property.This is an excellent strategy and one more people should consider doing in this inflationary environment to offset the biggest cost in their budget--housing.As you rightly point out, you can use this strategy with every house you buy accumulating a portfolio of houses that you originally started out living in as a primary residence every two years.Well done and more people should consider doing the same, or rent their garage, or shed, or a boat, or an extra car.Love it!

I say this to emphasize focusing on FHA and USDA mortgages in your search. 

If a tenant does not want to pay, a court can agree with the landlord but the court does not guarantee the landlord financial results, regardless of the lease.

Ask if they take debit cards and credit cards or must you write a check, The way I am comfortable with paying is payment for the job x amount, payment for the decorations according to a gross budget for everything, as they are purchased vs giving a pool of money to draw from.

I wouldn't likely/necessarily be mailing a lot of letters for example.But mainly, I would pay for a service that offered me the closest thing to an instant/on demand "preliminary title report" , that is something that greatly "simplified" initial research, preliminary only of course- based on apn.