They are not always the easiest to work with (Compliance and documentation standpoints)  and are very sensitive to Rate increases (think Fed funds).  

The prorated rent of $2000 I was going to put into immediate repairs.I was supposed to bring $1000 at closing, but an updated closing documents sent to me state I didn't need to bring money.

I first heard about Bigger Pockets when I was reading about the unfortunate situation where a squatter scammed a San Francisco rental (Cory Tschogl in 2014) and while reading further as the story was breaking the news, I found a forum in Bigger Pockets where the forum community was helping her go through the process.

Many RMLOs may not be aware of their compliance requirements and think they can underwrite, process and originate any mortgage, so it's their neck and yours as a lender.What you need is to have a buyer pre-qualified to ensure they can obtain financing required as an ability to perform under a contract, then show the ability to  pay, document by tax returns is what I suggest at 33 to 36% debt to payment ratios.

@Brian Eastmanare there any IRS documents you could point out that talk about prohibition on future funding in Partnership SDIRA LLCs?

It really needs to be torn down, but since it is listed as having square footage and value on the loan documents, would I put myself at some kind of risk by tearing it down?

However, if the numbers are on the tighter side then forcing the repair might be a good option to use and still close the deal.I would assume that if you were able to get responses from a number of others on the site they would probably say things like I am going to list here.1) Problems can seem small and simple at first but grow larger in a hurry - it happens.2) Depending on the type of shower/tub installed in the above unit it may be more than a simple fix and get into much more money than you think - you won't know until you open the ceiling for sure.3) After the plumbing repair you could be looking at mold potentially in the joist spacing area between units.4) Depending on the length of time the issue has existed and been patched to get by you may also have damage to the wood - joists between units and or sub floor issues under the upper unit tub/shower.5) If there is insulation between the two units, you may have soaked and degraded insulation that needs to be replaced as well - good news is that rock and insul are cheap to replace.6) OR......... you may have someone open it up to fix it and its just a simple plumbing issue and is a quick and easy fix - totally possible too.Just as an illustration, I went to replace a bath faucet for an accountant friend of mine yesterday.

Develop and document the system, train someone who is not a seasoned technician, and follow up to make sure he/she stays on track.  

Mark, I actually read your news letter.

Attorneys have different rates, call around and ask for consulting rate charges and have all your documentation in hand.