Absolutely repair your personal credit first.

I recommend buying into section 8 rental that have already did the modifications or repairs and passed the city inspection.

Checklist: Here’s a quick checklist to get you started:Get a home inspection (optional but recommended)Fix any outstanding repairs or issuesCreate or customize your lease agreement (covering pool/fireplace)Set up tenant screening processesTake detailed photos of the propertySecure proper insurance (consider rental-specific policies)Establish a move-in/move-out inspection processClarify utility responsibilities in the leaseConsider a property manager if you prefer hands-off managementDon’t worry, you're on the right track by doing your due diligence.

For our clients, we separate repairs into catergories: 1) Health & Saftey - highest priority to avoid lawsuits2) Property Preservation - don't want a $500 water leak repair to become a $5k repair later3) Government Required - for city & S8 inspections4) Marketing Negative Impact - who wants to rent a "purple" house?

I feel like there's no way the renter could be expected to stay in the house while this is being repaired, but I don't know how this all gets remedied.

These improvements included updating key interior features, enhancing curb appeal, and addressing any necessary repairs.

Initially I told the tow company that they appear to keep a 9to5 type of schedule but recently my other neighbor saw them repairing cars in my driveway during the day. 

I have all this cash in hand and I feel IRS is going to take a big chunk from it.I just did many repairs/improvements on the other property as write offs to help somewhat when I file next year.

Once it's complete you take title and complete your exchange.Can I put about 30% down on the new investment property using the 1031 exchange then take out a heloc loan of 80% LTV and use that money to make repairs?

Looks serious to me, but repairable.