Therefore the demand for student housing has increased while current owners await insurance settlements for their damaged properties.

What's sad about this is that they bury it in the closing settlement as regular closing costs. 

Worst case as a settlement with his heirs or a court battle is probable-In the absence of a will and it is not separate property, she is at least 1/2 owner of the property with any children(no idea) owning the other half. 

If I employed an agent who demanded I pay him before a deal closed I would terminate the relationship immediately and pay the commission after settlement.

Your basis in the property is lesser of the below in the year it was converted to rental: 1) your adjusted basis - ( purchase price adjusted for other various stuff -- such as settlement cost, improvements to your house and so forth. 2) FMV ( which is not a tax assessment) if you have used the wrong basis, in 2016,  to keep things simpler and practical, I would catch up the depreciation to make it correct this year. your depreciation basis is determined on the year it was converted to rental, and generally, does not evaluate each year.If any improvements are made to a property, they will be depreciated as a separate asset. 

We are currently working on a flip in the Brewerytown part of Philadelphia, and have 2 deals on the table for rentals that we are waiting to get to settlement.

We had a $50K suit turn into a $2k settlement--after 4 years!

Are they negotiating settlement?

Now I have to contact this person holding the judgment up in BF Egypt, NYC on my borrower and try to negotiate a settlement as with interest the judgment has accumulated, we can't close on the loan because he doesn't have the Freakin reserves now!!!

You'll want to obtain copies of and review any agreements that may be enforceable against you after settlement... including property management.