Need a referral for a solid escrow attorney who has experience with subject to deals. 

I imagine I would be close to 75% LTV after light repairs.

I keep all my real estate Investments in Kentucky. 7% or more is the norm for single family residential while in California you most likely land around 3%-3.5% cashflow, you're not even close to cover the interest rate.Definitely check out Midwest states, they offer low entry point and stable rental market.

In our contract with the lender there is no timeframe stated for when the property needs to close by and the lender needs to be paid.

Your prime focus is to insure that they have no additional health concerns staying in the property.

Also when the weather is bad during hurricane season they will often close the ferry, which can make it impossible to get to the island. 

Stay away with trying to get it under FHA if you already own a primary it will get "Red Falgged" in underwriting. 

IE: get signed purchase agreement, contact title company, pay-off tax lien, secure title and then close with cashier check at the title company?

I have ran credit checks/ background checks and we have a very close mutual friend.

Not subletting it out or their children aren’t staying there instead.