Certainly get it inspected and make sure everything is up to code (electrical, plumbing), and if not, budget for rehab accordingly.  

I came across this Ted Talk by Rory Sutherland that explains how advertising creates perceived value as opposed to actual value for a product.http://www.ted.com/talks/rory_sutherland_life_less...Understanding the power of perceived value is crucial for parties on both sides of an advertised deal.

You sill need to pay a mortgague, and pay for electric, gas, taxes, insurance, etc, just like any other house that you can live in. 

However use licensed pros for big jobs like AC work, electrical work, etc. 

I also think you are elephant hunting with a .22, not a BB gun, but still under powered for the size of the project to start off with if you don't have RE experience, and that too can make investors gun shy.

It's been a few days since we close and so far, I haven't moved utilities like gas, electric,w ater over to my name and it's still in the seller's name.

And I know the current garage area is not attached,  it has its own electrical meter,  and it has a hangout area with a kitchen and stove in it.  

Him " I need a place to stay with electricity and running water, I need money to eat off of and I need a few bills paid off"My offer was to , at closing, pay his past due bills, pay for 1 year lease in an apartment and pay him monthly $500.

Your biggest investors will have the negotiating power, however you can try something like this:Pari-passu: 0-8%, 90lp /10gp First promote: 8-16%, 75lp /25gp Second promote: 16%+, 60lp /40gp Hope this helps.

Establish contact and arrange a payoff so that the lien is cancelled before the foreclosure process is triggered by the "Power of Sale" clause in the senior lien aka Deed of Trust in NC.