If the cosigner is not contributing funds but is just helping secure the loan, whats a fair way to compensate them?

$40,000 x 25%(assuming a 25% interest rate on credit cards) = $10,000This is more than the annual cash-flow that you are getting from the rental.I would look at a way to paying off the credit card debt asap.Look to see if you can take a HELOC on the investment property(likely difficult).If you can't you may want to consider selling the proprety.You will also feel a lot of relief of not having credit card debt hanging over you.What is the interest rate on the car loan?

Option 3- If they have qualified for FHA; counter the offer to see if they can qualify for low downpayment conventional loan

DIRECT MORTGAGE LOAN COMPANY6.

Nothing builds credibility more than telling your lender that they are protected with loan documents you got from a stranger off a website.  

Yes I know about the VA loan (no down payment) and VA disability payments, more on that later.  

Work with the hard money lender on the terms of the loan so you can get a 90% loan and the hard money lender will reimburse you for the rehab costs. 

I would look at the DSCR loan as the first option.By the way, I suspect you are going to be disappointed by any refi appraisals   ADUs typically appraise poorly   JADUs can lower the property value Vs having the space as part of the primary unit.  

LTV would be determined by the type of loan.

OO loan seems like real long shot.