If you don't have the cash for your skin-in-the-game, you will not find a REAL hard money lender that will put up all the funds.  

My question is this: If I redo the drywall, change electrical and plumbing pipes, am I running into difficulty to sell the house after it was completed? 

I've started trying to value multifamily deals, but having some difficulty knowing what is reasonable to estimate for maintenance (i.e. repairs and capital expenses).  

I know anything to do with subdividing can be difficult, I would look into the process and costs of that to make sure you have the reserve funds.

With the info you've shared, I'm in the camp of giving them notice that you are ending their tenancy at the end of the lease.If you are not going to hire a local PM, see if you can distance yourself a bit emotionally - sounds like they have gotten under your skin if they have damaged your property and what really bugs you is their asking for their check back.  

Several FNMA restrictions apply plus the current lender may have their own internal guidelines. 1) How difficult is it to obtain a Supplemental? 

Ervin, Most lenders would prefer you have some skin in the game. 

With your credit, they may want to see skin in the game from you and/or they may not give you any money for the repairs; or cash advances.

Of #1-3 I prefer #1&2 over #3 as I feel the provider has more "skin in the game" and their compensation is better aligned to yours as the passive investor.

The difficulty is in finding the duplexes, though, and for us, since we're just starting out, getting the money for the down payment.