How do you think the 2 relatives will feel about having their rent raised or being required to pay rent period?

That does not require employment or job seasoning instead it uses the rents to qualify and you can take out up to 80% LTV cash.Use the cash to put down on the next 1-2 or more properties as long as the other properties are debt servicing themselves it opens up more opportuities to buy more future assets and increase your passice income.  

You'll need more capital and most will require a personal guarantee and personal financial backing. 

There are also 'mezz' lenders (typically for larger transactions) who will cover up to 90% CLTV and require you to bring the remaining equity to the deal, and additionally there is Gap Funding in the form of unsecured personal debt.The latter can potentially be the most expensive option, but allows for true 100% financing as there are no restrictions for how to use these funds, as they are unsecured, and generally obtained through personal credit, income etc (since there is no collateral for obtaining these funds).

google "all inclusive Deed of Trust" fantastic CA document we used all the way back in the early 80s If I'm not mistaken though a wrap would require the 2nd buyer to also agree to financing terms; which would be the same as me (the 1st buyer). 

What documents do they require, what credit scores do they allow, how do they verify previous rental history, etc.?

Obviously each deal is unique and requires proper due diligence. 

Purchase price: $275,000 Cash invested: $45,000 Sale price: $400,000 Contributors: Adam Schooley This townhouse, which had gone through probate, suffered from significant water damage to the drywall and required updates throughout.

Our standard email with the bid states, please contact us to discuss & redline to your budget.The only thing we will require are health & safety repairs, to avoid a lawsuit.

In general in single family zoned areas, JADU typically subtract value (I suspect largely due to the OO requirement).