From the financing side of things - keep in mind that conventional cash out refinances require 12 months of seasoning in order to use the new appraised value.

Also would charge points at origination and bump the rate up a point or twoReason being my guess is this borrower can it get conventional financing so they are a higher risk.

@Nick Belsky thank you Nick, I would love to speak about non conventional avenues.

9) adding multiple ADUs or adding an ADU to a quad looses F/F conventional financing.

Once there is enough equity, you can refinance it on a DSCR or Conventional loan so you can use your VA entitlement again to purchase your SFR.

Shop around for debt to see what is available and model the various structures to see how the different terms impact performance.The tradeoffs will be fixed vs. floating rate, conventional vs bridge vs CMBS vs bank vs agency. 

If you got your credit decent you can start soft shopping for conventional/fha home loans if you didnt do so well improving  your credit this is where you start looking for private  lenders, partners and investors.

In addition, due to them being eligible for conventional non-commercial financing they typically have lower cap rate than 5 units and more.  

I know of a lender that offers a 0% down, owner-occupant conventional loan that is a fantastic option for househacking.

Typically Conventional will end 42% of DTI and FHA can get up to 51% DTI (and based on your credit score I think you should stretch to that 51%) Just a few things to start thinking about as you are working through the process.