Cap rates are extremely important, primary importance to me, especially since CoC is only of relevance for about a year, Once appreciation takes place and your principal payments are paying down a mortgage CoC is no longer valid and will likely only decrease over time.    

Your tenants help you to pay your principal on the mortgage of the property."

Is it possible to pay off my principal after the appraisal with whatever amount that will make LTV to 78 and get rid of PMI.

I would analyze it to include the replacement rent once you guys move out because your true return of that property is providing you the utility of that rent (so if you lose $200/mo but would be paying $1,000/mo to rent elsewhere, it’s in fact a solid investment and you can ‘save that extra net +$800 towards increased principal pay down or save for another down payment.

I took out a HELOC on my principal residence and bought a 4 unit bldg. nearby.

A lease option puts you in position of principal.

If something goes wrong and you lose your principal, blame the fund.

To factor in appreciation, principal paydown, tax benefits, you'll want to figure your IRR. 

I have say 3 of these so far like this with my bank.Principal Amount $99,200 , 179 consecutive payments of principal and interest $701.32 every 5 years interest rate is based off US Prime rate plus 1% and year or 2033 will be balloon payment of $37,120.

Talk to your attorneyFor answer #2 & 3, you would typically use what is called a KP (key principal) and that person would help you qualify for the loan.