I presume this is not a state issue, although Indiana state law may require an even more stringent conformance.  

Three families are built to a different standard than two, and if you do a conversion, must conform to current codes.

You may also treat it as three separate exchanges and use the proceeds to purchase one larger asset as long as you conform to the timelines of the 1031s.

Another point is to have a total rent due for the unit, regardless of occupancy.As to additional wear and tear, I have done leases at a base rate and additional rents for an additional adult, unrelated tenant.If you have a 3/2, you could be leasing to a family of 7 and conform to HUD requirements, but you can't add to your base rent really and have a marketable rent level, just saying, additional wear and tear issues are really minimal IMO.

The problem is that I need them both to appraise for $50k+ in order for me to conform to a portfolio DSCR loan and only one of the properties needs a light rehab.

But again, seems like your property has plenty of spread and will easily conform to the debt service coverage ratio at $1,300/Month. 

So if your building has less than 12 occupants, say, you might have a defensible case that this is conforming to 4-plex guidelines.I've seen a bunch of converted buildings that are operating as 5-plexes, but are legally 4-plexes.  

I owned the mortgage company, the files were conforming to thier underwriting requirements, I was bonded and insured, files were approved before funded, title insurance was provided and assigned, the funding was 80% of par.

The alternatives to using the delayed financing exception are:CO-refi again later to pull the remainder outForego the exception and wait the 6 mo's seasoning and do a CO-refi for the full 75% LTVGo with a lender who writes non-conforming or commercial loans that have fewer restrictions with more expensive terms.So, while it's possible to get 75% LTV, there is always a trade-off.Also consider the impact of consistent 75% LTV on your debt-to-income (DTI) ratio. 

@Nick Nobile multifamily house hacks in Denver are tough at the moment.As of two days ago, there are 55 - 2-4 units available in the Denver metroIssues:Some of these properties are over the conforming loan limits for 2020.