This is not very common, but a possible risk.And lastly, I am not an attorney, so confirm all of this with a local real estate attorney as part of your due diligence on property.

@Gulshan D.If you haven't already, you should check with your lender and attorney to confirm that's doable.

Now, if it's investment properties, that's a whole different story, and yes there is ways to confirm not only numbers BUT the quality of that connection. 

Because I am a full-time college student and I work part-time I ask that the interested parties submit a rental application before I show the house, but many of them refuse to give a rental application unless they can see the house first.The criteria for what I look for in a rental application are as follows:Credit report: I look to see if they have had at least 90% or higher on-time paymentsBackground check: I look to see if they have ever been evictedJob and rental references: I look for a steady income and make sure they can afford it with what they make I also call their current landlord to make sure they have been a good tenant and confirm the information the tenant gave me.I currently have it listed at $1650/month with a 12-month lease.

Talk to an insurance agent to confirm.

Thanks Kiki for confirming!

Of course, the virtual numbers that the tool spits out have to be validated "the old fashioned way" by confirming the assumptions the tool is making (comps for daily rental, occupancy, vacancy rate, seasonality, etc.) 

         - The second challenge this creates is for investors or buyers with limited capital or down payment reserves.

A few questions come to mind based on the info in your post: 1) On the rental, Is the $50k just for the downpayment, or do you have additional funds available in reserve to cover cap x?

It may require you to maintain a specific liquidity ratio over the life of the loan, or maintain cash reserves equal to a specific number of payments, or upon inspection prior to the loan being Funded, Require you to come out of pocket with cash, for instance, to replace the roof because it has more than two layers on it, replace or grind concrete that has heaved, or embark on a program of replacing balconies that have rotted within a certain amount of time, et cetera...