It would cost a lot to get the planning approval and do a complete renovation of the 2 units.Can anyone suggest what would be my options at this point?

Hard money typically refers to a company that has it's own underwriting guidelines, rates (9% - 15%), costs, draw process ect.

Also, the turnover will be much lower, but maintenance costs might shift too, so it's good to plan for that.Happy to connect if you need more tips!

Find Brandon's videos on YouTube for the "four square" method of analyzing homes and practice.

Also you should inquire with insurance agents about the cost to insure.

We don't believe they are stealing, but their negligence has cost us a lot of money.* Is this enough to file suit in small claims court? 

I'm with you that sidewalk slip and fall litigation may be less likely in the Midwest than say Mid Atlantic which tends to have more litigious cities but dismissing premises liability issues can come back to bite an investor and when these properties have such razor thin margins that an investor must consider the cost benefit analysis of safety against ROI, there is a real estate issue and is usually a losing proposition.   

I think what @Garrett Brown is getting at is using this in addition to other methods.

Once you pay realtor fees, closing costs, sellers want 10k for points and concessions.

(G) Acceptable forms of payment of Rent (including Additional Rent) are ___ personal check, ___ cashier’s check, ___ bank check, ___ money order, and ___ the following online/ACH payment methods ____________________.