The return for a flip, especially if you've overcome the lead paint issue, would put you in another bracket as well.As for the existing 2 bedroom,  I'd try to switch the living room with that one bedroom upstairs unless it's normal in that area to have living rooms downstairs.

What I do is to present solutions to overcome his problem(s).

We need to master overcoming objection and realize that banks and seller and buyer and people are crazy and confusing.We need a good sounding board, team of people, solid spouse and strong mind to get through the accumulation mode of buy properties and controlling property. 

I changed my job and increased my income to overcome that fear.

Those banks selling off generally have "buy back" provisions built into the loans in case they were not underwritten properly and a default occurs.With commercial lenders they look at liquidity, net worth, annual income, and track record.You can overcome track record with high net worth.

However, many jurisdictions allow for these "merger clauses" to be overcome depending on the equity of the situation.

So your purpose may be to create systems and processes to overcome challenges your company faces.

@Tom MartinowskyDetermining the appropriate price for a rental can be a big hurdle at first but is something that can be overcome with the right knowledge and research.

My question-How do you personally overcome this objection or teach your referral partners and clients to come to you with creative files but not miracles?  

To overcome this obstacle, you may want to look for a non performing building with a motivated seller.