Unit was rented by some one who was the manager for a about a year and then gave over managing to me.

That's the only way you will know if it's legal.In a true wholesale deal you are putting the property under contract, then either assigning your contract or double closing. 

But then comes the bombshell..."

I have each of mine under a Landlord Policy, but then have an umbrella policy over my own home and the rentals; extended liability coverage.

If he feels he still has rights to the rental and the deposit, then that also means he has responsibilities for the damage and is subject to charges.

Need to put the windows and doors in, and then start the mechanical rough inside.  

The HOA can decide to do a special project or make a short 3 story elevator more hurricane proof ($800000) or have issues after a hurricane and then you are definitely not ahead of the game.Please connect with me and I can maybe point you in a better direction.

Then being aware of the complexity of structuring the property correctly for long-term goals is important.

Then you can read a more in-depth book like The Book On Rental Property Investing by Brandon Turner or The Unofficial Guide to Real Estate Investing by Spencer Strauss.2.

Since then, I've chosen the Couer d'Alene/Post Falls area and have already started working with an agent.