I would recommend you find yourself a fee-based financial planner who could look at your total picture and help you craft a plan to reach your goals.Things I have not heard you describe are insurance, estate planning, and taxes.  

I am not an investment advisor or financial planner, nor am I your agent or fiduciary.  

I know I'm going to get different strategies from different planners, that's why I thought it may be good to throw it out on this forum.

Your father as he had aged should have moved most of his wealth to untouchable equity and liquidity assets.A proper estate planner would have helped with this.

Check with your planners.

Accountants, Insurance agents, financial planners, stock brokers, tax people, Trust administrators, loan officers at banks (banks won't buy a seller financed note) bankruptcy attorneys, any government office that administers public benefit programs: Division of family services, welfare office, medicare, don't think that a note holder is always wealthy, they inherit a note and can't live off a $300 payment, the note is an asset and disqualifies  people from receiving benefits.When I said "they called me" it wasn't just note holders, many times it was the people trying to work with the note holder, they had a problem to solve to assist their client.I was the only Note Appraiser in the state, I believe, the state sent me notes to appraise!

To figure that out, talk to zoning department ( bigger cities) or city planner ( smaller cities).  

If I was in your shoes, I would start talking with realtors and financial planners to get their best suggestions, given your likely budget and time frame.

Your best bet is to go downtown take a number and meet with a planner, plug your meter for MAX hours and take a good book!

Appreciate the kudos @Marvin McTawSo I spoke to the city's P&Z Senior Planner and he confirmed that based on current zoning and lot size, the city will allow us to add a third unit to the duplex!