Got into REI almost by accident and did what you said - shopped for the best terms to make each property perform the best.I did at one point try to consolidate, but any institution I found that didn’t sell mortgages had the worst terms: higher rates and typically ARMs, which I’m grateful for not taking because my rates would be crushing me now.I’ll look into other versions of some of the things you mention like cross colatteral and construction loan but not sure how that would work considering I don’t actually have any construction needs. 

And even if it were stunning newer granite of quartzite, removing installed granite is difficult and usually will crack as it is glued down with some sort of caulk.

What sort of risk mitigation will help you sleep at night the most?

I use this to sort of "sell the area".  

First of all, you want to do your due diligence to make sure you know what your are getting into and hopefully you can get some sort of assurance from the Town that the two family is legally non-conforming.

Licensing --- Most reputable lenders regardless of whether they only do private money loans or not will have some sort of licensing 2.

My previous tenant lived there 20+ years with no issues but that's not to say something as, worst case scenario, dying can't happen in the future.There are full size windows along the side of the building and also 2 separate entrances.  

Have someone call, email text showing interest in the lead and see what sort of response you get.

In Seattle a worst case scenario can cost you up to 100k if you have to repair into the street and put in a new tap.

Our experience has been that when this happens (we have had this situation at least 4 times) it always plays out the same way, there is some sort of clerical error and we usually have it resolved in 1 -2 months AND they pay the back rent.