Historic 1920s house in Raleigh with knob and tube wiring

[Daniel Mock]

I have a house under contract that's a 1920s build in a historic neighborhood in downtown Raleigh. The house is in overall good condition with original plaster walls, plaster ceilings, original doors & trim. It also has all original knob and tube wiring. 

1) Would we have issues closing with a conventional mortgage with this wiring? 

2) Is the wiring save to live with while we save up for a full renovation over a year or 2?

3) Any tips on replacing the wiring while keeping the integrity of the plaster walls?

Any advice/suggestions help. Thanks!