My mortgage would go up $781 for the next 30years,  the ADU income would more than cover & I hope to pay extra principal to cut my loan time -it's just I was hoping to pay off ADU within 5.5yrs- so that I can collect 'all' ADU income at that point <I'm fixed income & I lose 'some' personal income in 5yrs so trying to plan ahead on how to recoup that>.

Would love to learn from you all experts here and contribute in the discussion as well.

Major dry rot/pest issues or perhaps knob and tube wiring would make me hesitant as well. 

Sounds like you have a great mindset and plan moving forward.

I do plan on using my VA loan. 

I’m not in your market but we plan to do the same with our garage conversion. 

Also, if you are open to other asset classes, you might take a look at small commercial spaces in some of the outlying communities as well as light industrial spaces that need some TLC. 

In short, all of the people that you need on your "team" that I have used personally, as well as, many of my clients for many years.

Purchase price: $1,450,000 Cash invested: $2,000,000 Sale price: $2,300,000 Letter for bank financing:"Dear Debbie,We would like to apply for a construction loan to fund a project that we are currently finalizing our construction plans for.

You can let them know well in advance rent would go up to $X or simply ask to have the unit vacant at closing as it will be close to the end of their lease.