I do not see that home prices have dropped 2-3% and this is a lot of added savings in additional to a downpayment if so. 

My investments are all in the Twin Cities suburbs, but I have helped people with financing as far north as International Falls :) @Jeff Schemmel who do you know in the Duluth area?

The longer the maturity rate of the bond, the higher the yield is to compensate an investor for the additional risk they are taking on with a longer dated bond.Stocks that pay divideneds....insurance companies have a lower yield than telecom stocks as a reflection that telecoms are higher risk than insurance companies.In the efficient market hypothesis, if markets are efficient then the yields should be reflective of the risk.

Many insurance companies do not allow adding a landlord as additional insured.  

Duplex have different zoning that may permit additional units.

Return:Finishing the basement and adding bedrooms can add significant value, especially if your local market places a premium on additional living space.

My budget is in the $200-250K range.Please feel free to let me know if additional details would help, and thank you in advance for your time and advice! 

Quote from @Conte Cuttino: Makes sense @Andrew Freed so say if we I can make it additional legal space, do you think the 107K left in the property for the return is worth it or should I sale and move on? 

In addition, some of those fire victims can afford to pay top of market price for homes. 

Not only do they not repay funds, they claim we owe them additional funding for renovations that never actually happen.