I do not understand how the past actions of owner, tenant and PM effect your pans to purchase a personal home or a investment property if the present owner terminates the existing lease.You have not made it clear in your post where the problem exists for you as a home buyer or a investor.

Either party has the rights to terminate the contract at the point.   

About what I thought ... there are still no substitutes for trust but verify ... when you need to fire them for cause mid way through a draw period do you tell them sorry but no more $, pay them up to the next draw period even though they haven't finished (and have them sign a release), negotiate something in between (and have them sign a release), or wait until they finish up to the next draw to terminate them right after cutting that last check (and have them sign a release)?

I offered a free month of rent in order for the lease to be terminated and her to move out at the end of April.

I just want to make sure that I'm not stuck in the deal and confirm that I don't need the seller to mutually agree to terminate the offer.

If you are funding a longer term (in my world that's longer than a year, but less than 7) then you and I would be joint venture partners.

But in the end people like dealing with people of integrity, and IMO, you will get much more back long term in referrals and goodwill by taking the high road.  

That said, we are in need of an experienced Real Estate Attorney to draw up a contract that will protect our assets and provide us with exit strategies in the event that our partnership terminates or we disagree on when to sell, etc.

And why not terminate your insurance?

She's been paying you rent and you've accepted it, so that solidifies the agreement.If you chose to terminate her rental agreement and serve her proper notice to do so, that's the first step in the eviction process.