It included similar "loss of rental income", same liability limits, included building code upgrade, vandalism and even 10% for water damage and 5K for rot.  

no average jo blo can save their way to wealth, society keeps people in debt, ergo amortization of debt....buying and hoarding stuff(in storage you pay busting out of your garage no less ), stuff you don't need rotting in storage or does not have value other than cashflow for storage unit business owners.

Major dry rot/pest issues or perhaps knob and tube wiring would make me hesitant as well. 

We are a humid climate and rot is also a factor. 

The foundation was completely rotted out and the house was falling in on itself, but after repairs it has made a great home to two different families.

It may require you to maintain a specific liquidity ratio over the life of the loan, or maintain cash reserves equal to a specific number of payments, or upon inspection prior to the loan being Funded, Require you to come out of pocket with cash, for instance, to replace the roof because it has more than two layers on it, replace or grind concrete that has heaved, or embark on a program of replacing balconies that have rotted within a certain amount of time, et cetera...

Rotting window frames, unsafe electrical issues, a tub and sink that didn’t drain properly, a promised dishwasher that turned out to be broken and unusable, a driveway with tons of pot holes so deep that they could have easily damaged cars, and much, much more.

Even just a back door frame starting to rot due to rain splashing up, we put up a diverter and fixed the frame.

If there is rot and its a more extensive of a job than merely replacing the window that will drive cost as well so you should seek a line item budget from the installers.  

I don't buy older wood houses - too many issues with rot/termites/fire hazard. 10.