The builder (Lennar) helped with the plumbing and claimed that there were no construction debris issues and it was the residence' fault which is not under warranty.

I plan to redline a clause I saw though that states the contract is valid so long as any tenants they place are in the building. 

I do wonder some about timing...if you dont come across a valid strong deal, why not wait till spring or summer sitting on strong reserves.

However, if your team has vetted and validated some of the pitfalls of your first deal, sounds like you found a winner! 

We are buying a REO, Special Warranty Deed studio condo from auction.com.

This equates to about a 24% cash on cash return.Your fear of having a mortgage while not having a tenant is a valid fear but that is why you need to buy right.

As long as you can validate the reasons, they may consider it.

You pose a lot of valid concerns, here's what I can tell you from my experience. 

I also think child support should be pretty easy to validate.

would home warranty cover it (not sure if they would go in crawl space to fix vent if there is any issue)vent has atleast 3, 90 degree turns. and goes through crawl space, guessing one of the connector might have gap or might be loose. any pointers or suggestions ?