From their credit report, it appears they are making regular payments and haven't been late with any payments on anything in several years, so perhaps they just put their wedding on the cards or something and planned to pay it off, but I don't know.

.- Given the fact pattern it appears that they are aiming for a Rent Escrow Action against me in court even though they have no basis.Questions- Should I respond to the repair letter?  

The reason I ask is in my market appraisers often do not look up permits to determine a unit is legal if the unit appears to be legal.  

@Brenda Garcia appear you may be responding like their intimidation tactics are working:(You do need to know the laws better than the tenants!

@Sandra Youkhana  It appears, you are living through what I lived through.

I just put one in my duplex last fall to make it more marketable AND to solve an issue with grading/appearances (and because I live there). 

When you exit a deal, what normally ends up happening (like Tom Brady keep winning more Super Bowls) is that you go into two more deals (with now double the amount of capital) and you will likely find that with those new K1s you could result in you having way more passive losses you began with If you can see where this is going... yes, experienced investors with a lot of capital deployed might have 500k-1M+ suspended passive losses and have not paid taxes in years and do not appear to pay taxes for years!

Remember that a lot of revenue is built on relationships with return renters and web sites like Airbnb where you build a reputation. 

Too bad as they were outstanding tenants in every way (their unit appeared owner occupied nice, rent always on time, easy to deal with). 2nd was married couple with a trans female and birth female.  

They had a rental/web portal that hasn't worked in the 9 months that I've been with them.