Finalize whatever arrangement you will be using for construction funding (bank cash, etc.)8.

I then arranged to have a full inspection done and I failed.

Arrange for an emergency caretaker for the pet.12.

Two points: (1) the Arkansas numbers may be skewed a bit because of a temporary pause due to flooding; and (2) this does not even vaguely resemble the run-up to the 2008 recession during which foreclosures were at all-time highs, cures were at all-time lows, and lending was notoriously loose. 

What is the living and rental arrangement?

Assuming that the seller financing arrangement makes financial sense and I pay the owner $1,000 per month (this is for example purposes only) how do I handle the rent payments coming in from the current tenant?

Yes, a bonafide debt arrangement is required.

I will message you to see if we can arrange a data and time.

Your lease may read differently though (although, I personally would follow the intent of the arrangement).

The IRS has challenged similar arrangements in the past by asserting that a replacement property in a 1031 exchange that was either (a) subsequently gifted to a child or (b) rented to a child did not qualify as exchange property because it was not "held for investment."