You may lose some sleep.

Initial cost is driven by home buyers making it too high and rent is rarely sufficient to cover expences.

Double check that is correct.You might want to reevaluate the amounts you are holding for CapEx and Repairs.  15% together is probably sufficient.  

you could be ok with that and sleep better at night. 

You may or may not have sufficient primary insurance, but I highly doubt your PERSONAL umbrella policy covers business pursuits, no matter how hands on you are.

I would make the decision based on the math and protect for contingencies, i.e. make sure you have sufficient funds to complete the remodel (I like 2x to be safe) and have a plan if things get delayed or the market changes to make sure you don't get stuck with the higher rate for too long.

You should do what allows you to sleep well at night.

Good afternoon,I have clients that are currently interested in a triplex property and qualify without an issue but the property itself does not pass the FHA self-sufficiency test without one of the unit’s income, since it has to be owner occupied for FHA due to one of my clients having a foreclosure on their credit that won't be removed until March of next year.

I guess it's time to carve out that time for sleep.

There are pros and cons and I believe not worth it.....just properly maintain your property carry $1m in Durante, sleep well.