I am thinking to have a contract 1)I give up all future rent but also the liability (tenants are month to month)2) he would put money in escrow account 3) do a double closing in seven months Any ideas?

This gives them the most protection, but like I said, they're over it and ready to destroy their credit over the double anyway so what's the point?

Your capital gains are lower if you owned the property for more than one year, double check with you accountant to see if the numbers make sense.

Is it as simple as an assignment contract just like a wholesale deal or do I have to double close or is there a different method for wholetailing?

Double check or you might be stuck with that single septic. 

One item you you might want to double check on is taxes.

Shouldn't they owe me for the increase in rent for the amount $50 dollars as well as late fees because as of the 10th I did not receive a payment (They both pay separate so that would be double late fees) and I was told after the fact that they would like to use their last month's rent for this month.To end this long ramble ( I apologize)!!

More likely it will be a process of multiple deals that get bigger and bigger or grow from one deal at a time to many at a time.First, you turn $55K into $110KThen you turn $110K into $220KThen you turn $220K into $440KNext you turn $440K into $880KFinally, you double the $880K.  

I think a more realistic rehab budget would be something like 85K ($25/sq/ft * 1614sq/ft = $40,350 and then double that for a conservative first flip = $80,700), but I just wanted to be SUPER-ultra-insanely conservative. 

@Cameron Rouse check the landlord tenant laws first, but usually you can charge them the rent until it is re-rented, because you cant collect double rent