I guess the mere fact that I felt I had to get a 3rd party's point of view already tells me I was uneasy with the proposed transaction to begin with.

However hard to speculate without undersanding more about the property, proposed construction, timeline etc.   

Make sure the zoning change proposal makes sense beyond your personal interest.

In the H.R. 3936, Built in America Act, it was proposed to extend the 100% bonus depreciation until January 1, 2027.

@Kenya Williams, to be clear BRRRR stands for:BuyRenovate/RehabRent RefinanceRepeatSo what you are proposing is not a BRRRR, by definition.  

Also especially for DSCR they will want a family strong appraisal and comps, but some lenders can also utilize proposed DSCR income to qualify. 

Many lenders will even utilize proposed or STR income to qualify. 

The owner of that property in question cannot restore his full VA entitlement until such time as the VA loan is paid off in full.Further, even if you gave him the 3.5% down on FHA, his DTI will still be hit with the payment on that VA loan, almost certainly killing his next home purchase before it even gets going.And if he gives up on homeownership, all the future potential landlords are going to see that mortgage on his credit, and likely consider him unqualified for the rental unit.Unless someone is going to write a check to pay that VA loan off in full, this is a predatory activity and the victim is the owner of the home in question, given his goals and the proposal on the table.Do the right thing.

Obviously paying interest on underutilized capital is sub-optimal but when factoring in the cumulative proposed transactional savings, the annual total interest cost could be equivalent or lower than the net of an alternative home equity line of credit on the same principal loan amount.One 'hack' could be to delay the actual closing of the DSCR loan until a quality purchase prospect is identified and/or near under contract.

I know the new rules are not official until next month, but the initially proposed contract term would go into 2026…)