That said, safety of your tenants should be of your utmost concern.

It seems as though you have developed a great strategy of handling these types of tenants, but with this being our first rental property (and me being a 5'1 female against these two), there's no way I could chance my safety. 

The vehicle is my primary mobility device and contributes directly to wealth building and the safety of my family, in all other ways it’s a liability I have a semi functioning truck and some real estate tied up in my late fathers estate with with about 25k in back taxes plus lawyers fees.

The vehicle is my primary mobility device and contributes directly to wealth building and the safety of my family, in all other ways it’s a liability Liabilities all my “poor guy stuff”I have a semi functioning truck and some real estate tied up in my late fathers estate with with about 25k in back taxes plus lawyers fees.

Your profit and the safety of your money.

After the rental company cut , I may end up with 1800 and with mortgage around 1500+ in ARM , I can be in safety net for 3-4 yrs and refinance to conventional.

If the issue is purely cosmetic, then hell no.....not a chance.You are supplying a livable unit for them....on the VOUCHER program....you aren't building them their dream home.Do this and prepare for the flood gates of other things they want to upgrade to make the place nicer....Unless there is a safety or health issue, they can pound sand or move somewhere else....at which time if you want to upgrade the floors and up the rent, then go for it....DO NOT DO IT....

How do I find out if this is a safety issue? 

Don't forget your safety glasses :-)

Even with a regular 203K you might only be able to do it if there are safety issues involved.