First Flip Questions

[Eric Le]

Hello All,

So I'm on my first flip and got a few bids in. One contractor pointed out the old cloth wiring. I don't want to spend more than I need to, but I don't want to finish the house only to fail inspection on cloth wires. Do I go ask the township ? Will that open cans of worms?  

There's also a crack in the basement wall, that leaks water in (Not much on a heavy rainy day), would that be foundation issue? 

 Is carving out the crack, putty in (seal), parge it. Then Kilz sealer (Of course the right way), The right cheap way to fix the leak? 

Thanks in advance!