This would require some great UX and design to communicate to customers effectively and avoid a high bounce rate but it isn't impossible.

What else should we be communicating to the seller?

Be sure to communicate with the tenant and try to come to some sort of an agreement. 

I think if the deal is communicated and spelled out clearly you can avoid a mess later on.

Being upfront, honestly, and clear communication is definitely at the top of the list.

The problem is that Podio is not the best for email communication within the platform.

I see a lot of owners are emotionally disposed to hold on to their home as a renter but it's normally not the best use of your capital

c) any further communication (we all have lives and work...except the tenant-wife apparently)?

My advice would be, always look at your numbers first and foremost; try not to get emotionally tied up in any property if you're investing in it.

You might put more value in financial and your wife is thinking emotionally for the happiness of the family etc.In future years on an ARM if you see that rates are rising past the threshold of the ARM then you might want to refinance for a long term fixed rate at that time if you want to keep the property long term.