I have heard similar situations from other investors that I have worked in California.

The US mainly does recycled steel production since it requires far less energy and potential EPA issues, but recycled steel can't be used in most technical situations.

It’s a complex situation that requires careful consideration.  

But I would add this: the right tenants are most definitely worth holding out for.In the LTR game, good tenants, in any long-term rental situation, almost always understand that they ARE good tenants.

If you ever have a situation where your On Island Agent has to have interaction with your guests, you have to keep in mind this person is representing you. 

(We discussed the "problem tenant" situation above, and I believe it was an anomaly and not necessarily due to poor tenant screening.)

You can definitely do a DSCR loan for this situation.

Given the situation, I would recommend taking the $100,000 from your primary residence.

Sometimes if that is an approval verse a bank account showing $500K for example, the agent on the list side may need a little education on what you are looking to do, I always have the lender call the agent in this situation to get them on board to get the listing agent more on board. 

@Nick Belsky gave you great advice.In this situation, best to keep it as simple as possible, and I often give two offers; first, perhaps an all cash (way below market) and let the owner know that it is what it is--a below-market offer.#2 would be the seller holds the financing--I wouldn't go to a 30-year amortization, especially with an 80-year-old seller.