Considering your investment property, you might find their insights particularly helpful for understanding the different financial arrangements and benefits.

That would be about 2-3 hours away for you but we can arrange a go to meeting or phone call?

I asked I want to arrange my own inspection and she said ..

Tenant said the flapper valve on the toilet sometimes stuck-she paid the bill and arranged things with the water company...but in this day and age I'd like to think the water companies would alert users if there is a massive and continuous spike in water consumption.

Can you imagine taking the time to find a new place, pay the despair, set up utilities, arrange for a moving truck/company, packing and unpacking everything, changing addresses everywhere, etc etc etc.

I am trying to be understanding since this is a difficult time for the family and they certainly have many arrangements outside of the sale of the house to consider.

If the tenant does not pay and doesn't make a payment arrangement with you, then you proceed to evict like any other nonpaying tenant. 

Their management agreement is win-lose arrangement. 

Are there any verbal agreements or arrangements between the current Landlord and Tenant?

You might want to do a little research on what are called pay for delete arrangements depending on how old your collection accounts are.