Additionally, as the note own you could approve a potential short sale on the table, whether yours or not.

There are additional acres to expand on.How did you find this deal and how did you negotiate it?

Interesting addition when you suggest that builders are the only ones to reap any profits. 

Luckily, we were able to fix the problem by adding an additional clean-out closer to the street, at the front of the property, and clearing out the roots in the pipes.

A heloc can "never" be used as an "Asset" or Liquid reserve both required when you purchase additional rental properties. 

I have an offer in on a property setup exactly the same with big house in front and a little additional unit.

I was told I can pay $3k to remove the part of the tree that's hanging over the garage (in addition to the $3k deductible I'm already paying) or I can take the next door neighbor to civil court because the tree over the garage is actually dangerous to the tenant who lives there. 

Architecture did a design and well respected contractor estimated the buildout of 4 plex would be an additional ~800k for total project cost of ~1M. it would be ~1.2M for the 7 plex.  

Additionally, I normally build in at least 7% of the purchase price going towards transaction costs when selling a property.

@Eric Lowe Prior to pulling the trigger on a Cost Seg study, you should evaluate 2 things:1 - How much net additional deprecation tax deductions a Cost Seg study would provide: Best way to get this is by requesting a free feasibility analysis from a Cost Seg provider.