I want to share my experience with Jenny Yi, an STR designer in case others have had similar issues.

@Clark Harbaugh, Given the favorable tax rulings over the last few years (in particular revolving around trusts and their equaling a beneficial interest in the underlining propery) the IRS has actually been much more lenient (or at least silent) on these issues. 

And always have reserves to handle any unexpected issues.

Maybe call those owners and see if they've had any issues?   

4.Tips to avoid similar issues in the future?

Quote from @Aj Green: Quote from @Gregory Wilson: The real issue is how much of a deposit do you have to try to get back from them.Sure, your contingency might work but I assume you gave the deposit to the seller.

Because it still livable, and doesn’t have any issues but plumbing in the basement needs to be jetted almost every 1- 2 years because of root issues. 

its an insurance issue. not much else to do.. 

We have had a pipe burst during the cold winter months, the roof needed to be replaced (thankfully covered by our insurance), and some issues with electrical, which hasn't been majorly updated since it was built in 1973. 

His advice (before the debt issues even arose) was to sell my whole portfolio and start over doing wholesaling.