Just to clarify your water usage hasn't likely gone up 20%, but rather the amount tracked amount they are billing you for. 

If not, this sounds like you could set this up with seller financing where you pay your family member a certain amount at closing and then an agreed upon amount every month (like a mortgage payment). 

Don't take out a HELOC Jason, it's not worth the time it takes for the amount of money you need.

This would take a decent amount of investment to improve the kitchen and bathrooms.

What I’m Looking For:Loan amounts $50K or less10-year or 30-year mortgage terms (not just short-term fix & flip loans)Ideally 100% financing or very low down paymentA lender that finances buy-and-hold rental propertiesWhat I’ve Found So Far:I’ve come across a few lenders like RCN Capital, EquityMax, and some credit unions, but they either:Have high closing costs ($3K-$5K+ on a $30K loan, which is crazy)Only offer short-term hard money loans (12-24 months)Require large down payments that don’t make sense for small dealsI’m open to hard money lenders, DSCR loans, or any creative financing solutions that could work for these lower-price-point properties.Questions for You All:Do any hard money lenders offer 10-30 year terms on $50K or lower loans?

My suggestion would be to cap your utilities at a certain amount and have Tenants pay anything over that amount.That will help you manage your expenses, and also allow Tenants to gage their usage each month, and make adjustments if they don't want to go over the allotted amount.As far as collection, provide the bill showing any overages and just have them pay for it along with their rent. 

Because if you don't - the entire amount you pulled from the IRA will be taxable, plus penalties for premature distribution.

What is your price range/down payment amount?

Maine in particular has a few markets with a decent amount of multifamilies.

What is your price range/down payment amount?