What kind of strategies are you looking for?

As Sean Wagner mentioned, the city of Chicago has adopted their own regulations on charging what's commonly referred to as a "security deposit" you need to do it another way. 

If your numbers are solid, you might even be able to cover the monthly payments out of the rehab budget.This kind of setup works best for properties that need significant rehab, and you need to be confident in your numbers and your ability to get the work done. 

I'm probably overthinking this, but is it common practice to provide any kind of cable TV or Netflix etc. in a STR?

When converting common living areas into additional bedrooms, many DSCR lenders might view the property as non-conforming, which could pose challenges.

What kind of improvements are you making? 

There is no given answer here, because the whole property needs to be relatively consistent.Kitchens and baths are the common answer, but if they are passable and you choose to invest in them anyways at the expense of peeling paint (or off putting exterior color) and overgrown landscaping, the appraiser and tenant will be walking up with a bad taste in their mouth, thereby not valuing the interior work you have done.But think about the general flow of someone looking to rent: more bedrooms will typically dictate more rent.  

In our limited experience being on our own, finding the deal of course is the hardest part and is definitely a “it’s who you know” kind of deal.

Illegal basement units seem to be very common in this area.

these were common west coast rambler designs..