That would be your reserve fund, but you wouldn’t be paying interest unless you actually needed to use it.

Tenants stop paying rent all the time.

Would you mind sending your inspector's info to me as well?

They would have to foot the bill and also pay for the removal (up front) - because maybe they will work the disposal correctly, but there will be a next tenant - so that decision could have expensive consequences for them.When you present them with the true cost of install and removal, it may not be that important anymore..

@Vernon Welch II most tenants offering to pay their rent upfront are trying to compensate for negative qualification issues.NEVER override your screening process just because someone offers to pay several months upfront!

An improved tenant is willing to pay more...

I also recommend signing up and paying for a site called rank breeze.

Only one of these methods involves "saving" money, and most BP users don't pay enough attention to it. 

Insurance would cover it, I would pay the deductible, and no assets would be lost.If you are in an area like San Diego where people are more likely to sue, a judge is more likely to find you guilty, and the payout is expected to be higher, you may consider an umbrella insurance policy.

If you are looking to fix and flip, just make sure you look for a 12 month term, non-dutch interest on the rehab funds (this means you do not pay interest on the rehab money until you use it), no prepayment penalty, and avoid any lenders that escrow your payments at closing.