as far as taxes are a concern if you buy it right you can go back and appeal for adjustment of the taxes.I have done for most of my rentals. 

After you have established the baseline projections, make adjustments as you see fit.

I'm certain others will say they didn't say home improvement and got the heloc, but if you want to play it safe, not risk some behind the scenes risk adjustment on the terms, then say your family is expanding and a new kitchen and few bedrooms are your current plan

Your adjuster says it is $10K to replace your roof. 

Instead, it should trade closer to a 6 cap on tax-adjusted NOI using annualized T-3 income and T-12 expenses.  

If the note is underwater, one would want to make some adjustments in FMV to take collateral value into consideration. 

Being intimate with the climate of my (hometown) community I totally understand MOST won't touch that ethically with a 10 foot pole. lol@Peter MacKercher Thanks for the reply. 

Some adjusting may take place but it’s not really that complicated.  

I might adjust from San Tan, Queen Creek in closer.

However, in the letter there is also a line item called "adjustments to prepayment credits - see attached" for $800.