It will very likely raise eyebrows in underwriting.

If he raised money for Project A and invested in B then he wasn't using the proceeds for what he said.  

For BRRRR specifically, we ensure the property still cash flows even after the new appraisal and thus, raising annual property taxes.

And I've felt constrained by the limits on my ability to raise rent (market is a bit higher than what Section 8 will pay).

Are there legal reasons not to give a reason for raising rent?   

You raise the rents and expenses stays the same - it’s worth more.  

If you were using the property as you primary residence at least 2 years in the last 5 and its value has raised substantially since you bought it, you may want to sell your property to a corp to get the section 121 exclusion on the capital gain and start a new depreciation schedule on the new fair value.https://andersonadvisors.com/121-exclusion-depreciation-tips/

I am currently trying to raise some money, so I have some time but I know I need to learn more about this.

Louis born and raised and now reside in KC.

I had a friend that was trying to close on a property, and his interest rate got raised by 2% on the day of closing because rates changed, they wouldn't allow him to rate lock sooner, and they changed the credit score requirements on him.