In general things which qualify as origination indebtedness include money used to acquire, build, or substantially improve the primary residence that secures the loan.

Convention loans, private loans?

And I'm fairly certain after renovations the deal would bring in between $3,500-4,000/mo.BUT, I would like to do this deal with a private investor and use the BRRR method.

Know your prices on your capital, are you paying private or hard money?

The issue I'm having is securing funding for these purchases.

Private, commercial, hard, conventional. 

The prospective tenant says his credit is not good due to a divorce and would like to show it to me using credit karma rather then me doing a hard inquiry.. he also asked instead of doing 1st last and security to just doing 1st and last.

If they disagree you part ways with proper notice What is your plan for the security deposit? 

My main hurdle right now is securing financing as I am OOS and do not know my options for who can offer a new construction loan.

Generally, these will be lower income neighborhoods which already had problems.BUT, for those neighborhoods which had a strong support base and higher incomes, they could afford to have a volunteer Fire Dept, hire private security to drive the neighborhood, and keep the quality of their education for the kids up via private schools, which are generally expensive.When the down turn happens, richer families which sought to save money and chosed to live in the lower income neighborhoods, find themselves leaving the lower income neighborhoods and moving to the safer, higher income neighborhoods.