Also, if you have cash to complete the purchase, you can get preapproved and then make an offer with proof of funds and without a financing contingency with a standard 30 days to close.

No, just inform them you are the new owner (they may want proof) and provide them with the address to send payments. 

Proof of his funds updated monthly..

Jordan,The burden of proof will be on you (your attorney) if you sue your neighbor.

Obtaining valid ID and proof of income isn’t hard; for buyer prospects, swap proof of income for a pre-approval letter and/or proof of funds.

2) Time spent by others: to qualify for the test "100 hours and nobody spent more time", how do we track the time spent by others and what proof would be required in the event of an audit?

From talking to locals, there's a couple of issues than need to be addressed, some are the non-ecological practices that some of those developers have, unfortunately, our government profits from this investors and allows them to destroy manglers (which are the natural water purifying system of that area) dismantling hectares of mangroves and degraded the habitat of resident and migratory species burying animals alive.There's proof of fecal material floating beneath the city of Tulum, only 20% of the water is sent to the water treatment plant, there's no infrastructure for the exponential growth.The landfills in the middle of the jungle that is leaking hazardous pollutants into the freshwater system and that something that developers won't tell you.I love my country and it would be a disaster for everybody if this place ends up like some other great beaches around the world, that are completely ruined by greedy investors not following the rules.There's no urban or comprehensive master plan, and one of the risks is that Tulum will be like Playa del Carmen is today, overgrown and with environmental devastation.I will advise doing a lot of research before getting something in Tulum, different country, different rules, and practices.

Have proof - where did you wire the money, have all your documents in one place.

There's no proof it's even bottomed yet. 

Any other recommendation to ensurebthat umrella insurance is full proof and that it actually works and they dont bring that one disclaimer if and when it comes for actually paying for the insurance claim,  if ever.