I don't think you are going to be able to get insurance for two separate living units in a single-family when they are both illegal and likely do not have the correct egress windows (basement) for fire safety which could subject you to huge liability if something happens to either party.

However, in emergencies or cases involving health and safety, we would attempt to contact the owner first and, if unsuccessful, proceed with the repair as outlined in the contract.Regarding the hot water heater, do you know if it genuinely needed to be replaced?

Take it with a grain of salt as safety is subjective.You could also ask your Realtor and property manager their thoughts and maybe next time they are in the area to take photos.

That's great that he travels so much but ask him to provide where he rented and where he slept during that time. 

I know many landlords set a credit score threshold around 580-600 for Section 8 tenants since the program provides a rental guarantee.

Unfortunately, I think you should eat the cost on this.If you have a door that can lock, you should provide the key.

@Cosmo DePinto, I can provide further insight on behalf of my market.

Tenant then proceeded to provide me with his new address and another address for tenant 2. 

:We use the cheapest ones that they provide at Lowe's, our handyman installs.

Quotes from successful former “students” providing their first name and last initial only 8.