I think she’s reckless and negligent and only cares about her commission.

Fha is 3.5% down,  and they underwrite easier. the margin of benefit is almost negligable. 

Yes, over a long period of time the difference between the two can be negligible if you are making minimum payments.

Certainly, a solid sub over time will earn the last look to sharpen the pencil, but in my experience it's negligent to only stick to one sub as your provider for that trade.

Of course all repairs that are the result of tenant negligence or misuse will be taken care of and billed back to the tenant!

It's irrelevant to the negligence, therefore not presented at trial.

If you are sued for something like negligence on rental B they can go after any equity in rental A as well.

My other option would be to buy a SFR (to live in now and rent in the future), which I think would appreciate well and rent very easily but once again, cash flow would be negligible once you take into account repairs and property management.

Either way, I would stick to your guns, it was NOT technically an act of nature, it was seller negligence for not protecting the pipes properly.

The monthly transaction cost of a few texts and a monthly face-to-face conversation is negligible when compared to less rent, higher turnover, and higher vacancy.My business model is a high rent, fast maintenance service, and high touch.