less than 24 months most 5% banks won't talk to you, you can work with a mortgage bank and get about 7%. depending on the appraisal value and putting down 30% you will be ok for a refinance but having them appraise for 30% more to take out the full OPM may prove difficult. 

Then you take the distribution from the custodial account.You must plan for RMD, depending on how much cash you have left, the amount of RMD and the net income (rent minus expenses) you may run out of cash.

@David Boley you will still need to file state taxes for any income you earned in the second state though -- depending on the state.

Your rates will depend on LTV you elect plus the strength of the property.   

I have heard it is recommended to have at least 50k (or absolutely nothing depending on who you ask). 

I was thinking of something along the lines of a Wraparound Mortgage that has the initial $60,000 then having different options for the sellers depending on how much cash he wants now.  

Or you can get creative with friends/family and BRRRR it.It really depends on how much work you want to put into it because it seems like your parents have already checked out.

The next major issue is permits, I don't like touching anything that has a converted garage or patio let alone 4 jerry rigged bedrooms, the assesed value isn't necessarily an issue depending on the state especially (In CA there are $2M properties assessed at $200k because of prop 13)  Investors will see the real value but the other issues would have me concerned.

Of course in some areas half the city is in a flood plane, so part of this depends on location.I would check to make sure it is really in a flood plane.

It depends what the interest rate is on the student loan how fast you want to pay it off -as an example if it’s 3% or 4% and you’re making 10 or 15% on a house hack you can put all your money into the house hack and then use that money to pay off her debt.