I would attempt to save the existing drain field, perhaps it may only need to be flushed; have your septic guy give you some alternative suggestions and make the replacement the last choice as it is the most expensive.  

Don’t let that cloud your judgement that its ultimately not a deal.

Have you read Brandon's ebook Ultimate Guide to REI.

That was my choice as well (to simply address the letter to the owner and not mention anything about the passing).  

If the latter is the best choice should I cash-out refi or sell to recover my money for the next flip?

It is possible that your sponsoring broker could already have an agreement with certain pm's.If an agent is the procures a qualified tenant that ultimately signs a lease, we split the tenant placement fee.  

Big caution when you leave your job weather your choice or theirs you must pay all of it back within 30 days.

@Lisa GarrettYes, a self directed IRA is just like the IRA you have, but with different investment choices.  

Its hard for me to believe any true investor would past this up and if they did either they do not know what they were doing or they arent investors at all.So the 70% rule definitely has a place in flipping but it is not the ultimate determination of a deal. along side a few other considerations the 70% rule is a great tool, but like all tools they are only valuable when the are used correctly

Have you read Brandon's ebook Ultimate Guide to REI ?