Distribution of profit from deals can leave very bad feelings if one party believes they deserved more or that another party didn't pull their weight.

As an out of state investor myself, I can tell you at least 1/3 of my properties were bought from failed out of state investors.  

No, George, despite numerous promises to pay me a settlement amount, Andrew has continued to fail to follow through, and I am only one of several BP members to have similar experiences as I refer to in this thread https://www.biggerpockets.com/forums/522/topics/22... and in my three part blog.

We do not give any weight to the CAP rate when underwriting a property.  

If it was over 2 years this is considered a 'Failed Systerm' and would require a Septic Inspection.

C class properties if you look at historical data points really don't move in value much... the only way they go down in value is failed landlord syndrome and the house is trashed then it gets tied up by a wholesaler who sells to a rehabber who sells to a end user..

Well that is a lot of weight so I borrowed my friends large brand new dump trailer set up to haul over 15,000 pounds of weight. 

The investor is paying for what is needed and none of the bloat.Anyone who has experienced headache of a terrible tenant without a good property manager in place knows that PM are worth their weight in gold regardless of how and what they charge.

If my guess is correct then you will end up being told your property has been "abated" because it failed during the latest inspection.1) is the contract still salvageable?

Statistically insurance companies know older buildings have more things fail and have more claims happen.Some investors just get fire and casualty insurance which can be cheaper sometimes.