Paying a normal conventional mortgage along with giving them profit is significantly lowering your margins for you to make enough on cash flow especially after considering initial repairs and cap ex.

As things are occurring now, the bank is being paid, so they have no interest in property seizure or foreclosure, as it is a performing note, so the FIL currently has the opportunity to conduct control of it in the same way a normal person would, which should allow him to pass this via normal methods (living trust for example) to heirs, provided the payments on the note have no interruption.Am I off on any of that?

The lender normally informs us of what needs to be fixed. 

My agent who’s also a REI has told me that 4.75% is too high and it should be in the high 3’s and low 4’s but from what I’m reading online and from what I’m being told by these loan officers 4.5-5% seems normal?

We are fired up to build our rental portfolio and this will be the first time we look for a tax professional to guide us as opposed to our normal Turbo Tax form filling.  

The owner will be providing a list of the items that will be included with the property and their costs, which will provide us with a deduction on the legal fees.Logically, I would think that, since the current owner will be separating out the cost of the furniture from the apartment, we can perhaps depreciate it according to the normal ADS schedule for furniture, as it seems like it would be equivalent to purchasing used furniture for a property.

You are giving yourself the ability to invest in properties you normally would not have been able to, or would have had to wait substantially longer before doing so.         

Adding a stair glider or ramp in the front is easy and normally considered a "reasonable accommodation." 

Your agent should communicate with you quickly, often, and outside of normal business hours.

On your shared square footage you can allocate and deduct that % of all normal rental expenses.