However, this is not specific legal advice to you, just an opinion based on the circumstances described in this thread.  

Down payment of $13K including reserves sounds pretty low to me . ( Based on Maryland )

I think it’s a more recent consideration (maybe in the past decade or so based on my digging / anecdotal feedback) and perhaps some of you that have been in the business longer and simply renewing old policies may be getting a pass.  

Based on conversations, I think it might be a little of #2.  

Because based on those answers, you can just get a conventional loan. 

Quote from @Dave Schimmels: What is a good way to get accurate rent comps with existing tenants based on the area?

The analysis also reports that new multifamily development will “remain near the average recorded over the past five years”.Integra Realty Resources’ 2017 Commercial Real Estate Trends Report ranks Pittsburgh #2 on its Top Markets by Multifamily Transaction Volume Based on YoY Change.Pittsburgh’s rental vacancy rate has declined by 25% over the last five years.Pittsburgh is booming with developments (see reference #6), “there is no better place to be a developer right now than in Pittsburgh.

I trust his advise but I feel that its not worth taking a chance and I should ask her to politely leave based on the fact that she has lied on her application. 

is it based on hardware or just software that allows you to remotely access/ control the hvac?

Based on my experience of running properties, even if the build were to cost you as much as $600k but you could generate $125k/year, you'd be very happy with that investment.