Second, I am concerned about your research of the area here as you say prices are low.

Feedback from one buyer that has seen the property was their concern about the rot around the door.

The prior action might even have made things more difficult if a large amount of back payments were in a repayment plan that would likely require payment now.As for gaining control of his estate, you need to decide if it makes sense (if there is lots of equity remaining after payment of debts) and if you are the best choice for resolving this, especially if you have the financial resources and understanding to resolve.If you don't think you are up to these challenges, you won't have to be concerned with either repairing the house or the debt.

Since an LLC is a pass thru entity as far as the IRS is concerned, I would say no, there are no tax implications.

If you are concerned about protection then you need to get an umbrella insurance policy to cover the homes and your existing insurance policy. 

If it does, I would be concerned about vacancy, since finding renters willing/able to pay the required market rate to maintain cash flow will be tough, and your pool of potential renters will be greatly reduced.4% - 5% is a safe rate, assuming you can meet the down payment requirements.I am interested to know what your exit strategy is.  

So, the obvious concerns get raised when submitting offers on these.

I make sure I dive deep into there motivation while I try to listen to their true concerns.The main thing I would suggest is to remember that most people will give you a cookie cutter concern, based on something they've heard or read, however if you ask a few extra open ended questions you should get the real concerns.  

Third, in my neck of the woods there would be water credit concerns, etc....

Once down to studs - can GC take care of treatment and replacing of neccessary framing or do you need a mold specialist to come in and give "all clear" so to speak in order to resell house.We have read so many mixed messages about mold - obviously we know it is serious issue, but we also feel it is something people are overly scared of and super concerned because they are not going to gut their homes.