It seems like this may be good as the annual property tax bill will be less since it was purchased for less than the current market value. 3) Will paying the house in cash or financing the $150k purchase price affect the property tax assessment basis? 

Can I separate the bills for water and sewer so we both pay our own bills?

At minimum, it should protect you for any recorded liens (tax, water bills) and bogus claims to ownership (aunt Sally coming out of the woodwork to claim ownership).

Electric can easily be metered separate and water can have a sub meter by your plumber (which would require the effort of someone reading that meter each month on behalf of the owner to bill the tenant back.

It may be that there are medical bills, attorney fees,  or other things that they are waiting on before they can close probate. 

Open mailbox and pull it all out in a handfulWalking back down the drive, begin to sortSales papers and grocery ads go to the bottomNext goes the postcards that are obviously junkNext, anything else that looks like a marketing piece....including unsolicited business mailThen the billsOn top, anything personal or hand written (unless it has a bulk mail stamp, then it goes with the other marketing junk)Back in the house, the junk goes into the trash without a thought, bills go on the counter, personal mail goes back with me to my office or living room where it is immediately open and read....So the risk is simply not getting the letter opened.

@Bill Brandt this would be our first real estate purchase at all.

For utilities, while it will vary from property to property I think a common arrangement for small multifamily (2-4 units) which you'll see is that tenants pay for internet, gas, and electric, while the landlord covers the sewer/water/garbage/recycling bill, which is all lumped into one bill, at least for Mpls. $150-160/month is a good estimate for a duplex.

@Akshay Bawa There are numerous forums that are Canadian focused! 

repaied by 9/13 for township re-inspection and not my inspector with previously anticipated closing date 9/14: - furnace repair- *electric repair- *basement smoke detectors replaced- *2nd floor bedroom battery for smoke detectorHowever, the local U&R requirement is just for safe occupancy and certainly not to the standards of this house at the time of sales agreement (house was agreed to over asking, AND above market value locally due to its great condition prior to the flood), and PA Agreement of Sales specifically states ("home must be in condition when it was agreed to").I have had numerous emails/info exchanged with my lawyer now.Any recommendation, pointers, insights?