Any tenant with young children is going to create some damage but it is excessive.

AND they want you to have excess capacity above the ability to pay the loan itself.  

Have you had excessive problems with the current tenants?

You can not deduct losses in excess of basis -this is the basis limit. 

They don't usually have the excessive maintenance problems that the 100+ year old homes in the urban areas of Indianapolis have either.

There are exceptions where you can do an escrow hold back if the "Cost to cure" is generally under $2K or you have a seller amendment to cover the cost and then they will hold it in escrow until repaired to release funds to vendor with proof or receipt.You have Fix & Flip loans but they an be a nightmare and the rates and points are excessive. 

...can excessive rain really affect my foundation?

For balanced cash flow and appreciation, the basic characteristics we use include:• Single family• Two+ garage• Three+ bedrooms• Two+ baths• Within a minimum and maximum lot size• Built after specific year• Average time to rent below 20 days• One or two levels• Association fees below a specific amountWe eliminate from considerations most properties based on a number of negative characteristics (we have about 50 such "negative" characteristics) including:• Known bad floor plans• Subdivisions with rent restrictions• Known undesirable subdivisions• Properties with traffic or access issues• Properties with excessive drive times• Master bedroom too small• Ratio of lot size to the home's foot print• Tandem garages• Close to nuisancesFor high cash flow properties (usually class B or C) the requirements are quite different and these are usually town homes, condos and occasionally older small single family homes.

@Brett PalmerI would buy more rentals or flips with the excess cash.

Our lease states tenant agrees to allow us to take appropriate corrective action in regards to mold/mildew/moisture conditions.