Theoretically, over time, the buyer's credit improves and, when they can get a mortgage, you get paid the balance.  

You are elephant hunting with a BB gun, you need to get out of the jungle and learn real estate.Your questions are so vague they can't be answered without writing several books.Land is always valued with the market approach unless it yields income without improvements, then the income approach may also be considered. :)

If due diligence is ending and you are undecided it's better to send a letter of termination then let a contingency pass and be in a bad situation having to perform on a contract. 

If your greatest concern is a potential downturn, you've already performed the wisest hedge - buying properties in high-demand locations.  ...and if/when things go south, you have a few levers besides price to keep your properties performing:Providing quality finishes to set you units apart (which you may be doing already, based on your remodel comment).  

Do we make any improvements/repairs or don't bother since they're in the house and happy? 

Sure there are defects such as the loan is non performing currently or there are other issues to be addressed, but remedying those are what adds value to the loan and makes it salable or a cash flow stream to tuck in your portfolio.

I live in Mesa, which is close to Chandler, and I can see renting a home out for a season like to snow birds or possibly during baseball spring training but never would have expected weekend/weekly rentals as out performing traditional rentals with the high turn over and marketing costs.You have my curiosity,Casey

If you are not able to perform this task on demand, it could become ammunition for the contractor to extend schedule.You might consider adding contingency to both budget and schedule regardless of promises.

Is this correct, or can I get a refinance if say I buy a house for 50K and than ask for a refinance on that 50K property I bought in cash (without performing a rehab)? 

For my first deal or so I'd envision contributing the due diligence on the acquisition, performing all project management of the rehab (while paying contractors at an arm's length), refinancing / financing the property and then performing the subsequent management.