It cautions that even though the deed has been documented, a purchaser should proceed with caution because there is something unusual about the deed that calls for closer scrutiny.

Are will this come up during the inspection?

After the inspection, the inspector found several items that needed immediate attention like drain pipe in crawl space was disconnected from house, new AC units were needed and a few more items that the seller actually agreed to repairing before closing.

Initially listed at $285,000 in contract for $272,500 post inspection and prior to flood zone discovery. 

Stone has to be done by hand now (no room to get machine by )   This alone has set the job back over 2 weeks closer to 3 , and added $9000 to the " budget "       Would I eat this as the contractor ?  

With thorough vetting and inspection, private utility systems can be perfectly OK and represent opportunity for investors who are willing to dig in and develop a better understanding of how things work.

Yes, get a locksmith to unlock the doors so you can walk thru and inspect the as-is condition.

Backed up from other inspections Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

They will also charge you to have an inspection by a 3rd party to make sure the work is done.

You could also write some inspections into your contract, if you are willing to do them or have someone you trust do them. quarterly inspections + report of their finances?