They have been there for 2 years and I allowed them 2 cats for which they had doctor notes for as companion animals. 

About a 15 minute walk to the ferry with some views of NYC. 3br, 1.5 bath.

Take advantage of your situation and crawl before you walk.

For the record, I am a cash buyer and can ballpark a rehab budget in 10-15 minutes of walking a property.  

They want to do a walk through that evening which is not going to happen for a number of personal reasons.How best to get keys and is tenant responsible for unit until keys are returned? 

I definitely want to cease the opportunity I just need to crunch some numbers and figure out exactly how much I would walk away with vs keeping it and increasing rent every year.

After walk through, I believe my best option is to give a 60 day notice upon closing.

If anyone runs into this scenario in the future Bally to walk you through it!

I let my agent know that I don't want to lose the house equally as much as I don't want to keep the current tenants, but if it comes down to closing with tenants or walking, I'm going to walk.

Agent/Property Managers don't walk away from the closing table and wave goodbye; we enter a relationship with that house and a longterm relationship with the owner.