A few things to keep in mind when obtaining an FHA 203(k) loan:1) Improvements paid for with a 203(k) loan must generally be completed by a licensed contractor and are subject to approval by an FHA appraiser as well as oversight by the FHA-approved consultant if it’s the standard loan option.2) You must develop a remodeling plan, schedule, timeline and put it in phases. 

I better consult with more pros. 

And what this does is open up a lot of transactions for undercapitalized investor who talk a great game and sellers are not experinced or do not consult attorney or Broker to the risks..

One of their fundraising consultants informed me "every investor at Rad has made money" and they have over 8,000 investors. 

The corporate veil is really a legal matter, so consult with a qualified professional...If you are going to use the LLC for renovations, you may / should not be taking Title in the same LLC. 

Looking for a CPA/tax consultant.

May I suggest you consult with a TN real estate attorney to clear the cloud on the title? 

In your particular case, I would consult with a local eviction attorney to get their take on the local laws and regulations.Nonetheless if a tenant tried to pull this on me, I probably wouldn't want them as a long term tenant in the future.

You will be more likely to succeed and reach your financial independence objectives if you take calculated risks and consult with seasoned investors.

Please continue to consult your attorney in your state.