The 25K would go towards a rate buy down.As far as accounting for cap ex and maintenance for newly replaced/updated items, I'd still recommend doing it.

Do your balloons have caps? 

You already have this, its called being a shareholder of a company and a cap table. 2.

Even if they don't catch you now, they will catch you later when you try to sell a 2.5 bath that is only a 1.5 bath and the lower bath needs to be removed and capped.

Most purchase and rehab loans will be capped at 75% of the ARV and cash-out will typically max out at 80 or 75% depending on where you go. 

What are the cap rates you can achieve at refi if you BRRR a single family/duplex?

The numbers don't work for most Duplexs in the greater PHX area which includes not great cap rates.

The cap rate around 8.5% (when the local average is 7-9%), I think this price point potentially strengthens the property’s cash flow appeal.All units are rented on 12-month leases, and the seller reported annual expenses around $22,075.

My goals would be to increase monthly cash flow and have more access to the property's equity for things like Cap Ex, etc....Here's a blurb from a lender's website:"By combining banking functionality with home financing into one dynamic instrument, borrowers are able to save tens of thousands of dollars and years off their loan""Designed after popular programs around the world, the All In One First Lien HELOC is the nation’s first transactional offset type-mortgage program.Home financing and banking combined:Deposits lower your loan’s principalFunds remain available for expensesInterest is calculated on the average daily balanceThis lowers the monthly interest paymentsTens of thousands of dollars can be saved over the life of the loanMortgage freedom can be achieved in half the time or less

Your questions are fine, but I would be more worried about the asset and the future cap ex than the renters in general.