In most cases they do not want the tenant paying greater than 30% of their income for rent and utilities.

There is a high cost to renovating a non-restaurant space into a kitchen, especially if you need everything like grills, hood vents, walk-in coolers and grease traps in floors, not to mention the utilities to service all of the above.

. - Some credit bureaus and services (like Experian RentBureau or Esusu Rent) offer alternative credit reports that include rent payment history, utility payments, and other recurring bills.

I have turned 8% ROI into 18% ROI by utilizing wrap around financing when selling, as an example.  

- HELOCs are best utilized when they cover the entire purchase.

Let's assume for a moment that townhomes are an approved use for your property, I would want to quickly determine the availablity of all necessary utilities to service the property.

I found a lot of issues such as concerns with utility capacity, storm drain easements etc. that we eventually resolved and turned out to be minor but could have been show-stoppers.4.

Checklist: Here’s a quick checklist to get you started:Get a home inspection (optional but recommended)Fix any outstanding repairs or issuesCreate or customize your lease agreement (covering pool/fireplace)Set up tenant screening processesTake detailed photos of the propertySecure proper insurance (consider rental-specific policies)Establish a move-in/move-out inspection processClarify utility responsibilities in the leaseConsider a property manager if you prefer hands-off managementDon’t worry, you're on the right track by doing your due diligence.

For that you have to utilize our 2-step program (as referenced  above by @Clint Jusino) or wait the 12 months for a conventional loan. 

Many times, permits, utilities delays and material issues are but a few.