I finally found an insurer, and was able to close, but I had to remedy those conditions immediately.Note also that home inspectors will warn you left and right that they are not required to detect building code violations/deficiencies.  

You can not fix it up unless it is something that is needed for living purposes such as a leaking roof, etc. 

Both are negotiable.That said, having the renter be responsible to take care of leaks is a risky proposition.

But, you will (probably) want to have them call you about any water leaks.  

This can be tricky from a warranty perspective as if one is the plumber and you have a massive leak it will be very difficult to determine which sub caused the damageNot to see it can't be done, but it should be at a considerable discount

As a contractor I always prefer a full gut but it does eat away the rehab cost and takes longer but no stress about plumbing, leaks, electric, lead paint and etc in the future.The patch up would cost less, fast timing, but then you are gambling with what's behind the wall and hoping nothing happens in the future.I assume most house that are purchase for BRRRR purpose are in distress/bad condition and old on some occasion.What rehab number would you go for?

Found a small leak in the celling.

I make it more appealing by offering a refund at the end of the lease if there is no detectable pet-related wear and tear, including that which might be considered normal pet-related wear and tear.  

They are going to call and say there is a bedbug infestation, rats everywhere, no hot water, holes in the floor, the door won't lock, leaking roof, and the tub is cracked, oh, and the landlord refuses to fix all this.

They don't take care of themselves and when the toilet plugs up or the AC breaks or the roof leaks the PM will not be out there when the tenant starts screaming at you over the phone that they will not pay the rent until you get there at midnight on Sunday to fix the problem.