I had a rental appraisal done for it for additional cost during the process and the results were good enough so that 70% of that number covered my Principal, interest and insurance and property tax payments with a little left over. 

If they are able to cover the mortgage then they should be able to work the deal out with you.

If you don't many claims will not be covered during the renovation period.

This situation is not covered in the PSA.

So I wouldnt be making as much as I do now and not even enough to cover the mortgage.So if i was able to buy it outside of the exchange, I could take my time and get everything lined up. 

My question is: can those costs be passed on to the tenants and if so should they be billed separately or should the rents be raised to cover to costs?

I need to figure out a way to go after the cosigner who has the money to pay.This has been covered already.Hire an attorney, join the ex-spouse as a party to the suit, add claims that will result in a monetary award. 

I welcome discussion covering delayed financing and what can and can't be on the HUD. 

Are you talking about getting a single portfolio loan to cover the 3 mortgages?

And I just read some things about insurance companies not covering losses if they determine your house is either vacant or unoccupied.