My aunt consulted with her attorney who said that such a quit claim deal with a side agreement would not be legal. 

-------------------From a legal perspective, any mortgage recorded after another loan is a second mortgage.

I have been talking to some agents there and the plan would be getting a primary residence loan and have my family move in there for the next few years as they get more acclimated to the area.I was wondering if anyone has started their rei career in a city so far away, or if there would be any legal issues financing the home this way.Appreciate any feedback!

I called the health and safety board and they said its legal.

I've never cared enough to pursue but since we're on the subject... can some legal folks shed light on their opinion of a a disregarded LLC as a personal liability shield when the activity of the property is on the personal return of the LLC member and all income goes directly to the member? 

Unless the seller is the legal operator on both the well and sewage.

Tell that person and the other 3 to read the legal binding contract they signed .  

(yes there was legal paperwork but not any kind of presentation.) 

Evict her as soon as you legally can.

Seek competent, local, non-salesman angle legal advice on equity protection when you get there!