While they more than fit my main two criteria for tenants, namely pay the rent on time and no concerns about damaging the property, they are becoming increasingly demanding about improvements to the house and yard. 

The city is also working on another ordinance that will make it easier for tenants to report  substandard conditions to the city and for the city to be able to require the landlord to improve the conditions, or risk having the property boarded up.

Our debt is low (other than current home mortgage) and our credit is excellent, if that makes a difference.Thank you!

Of course lease renewals are mandatory, so choose your tenants wisely.FWIW if you maintain a requirement for high credit rating the criminal report will never be an issue, right?

I am sorry, but I feel this is truly a service to those who are desperate to not ruin credit or who can not manage costs of repairs etc etc....  

The credit union will re-fi 80% LTV, after 6 months seasoning, at 15 years fixed or variable 5/1 amortized over 25 years.

He says they wouldn't pass a credit check.

Not sure if you are aware that FHA has a home improvement loan program.  

What I was thinking about doing is taking out the HELOC in order to make some improvements to the property using OPM and hang on to my cash.Given that I am putting down 25% on the property it seems like I would have enough equity to get a HELOC but I'm not up to speed on how HELOCs work.If there is a better option to accomplish the same goal that you can suggest I would love to hear it.  

I have a credit union that will lend to my LLC at 4.75% for 25 years.