We usually have coremetric  data, loan to values, occupants, ages, occupant buying habits, modeled credit ratings and networth, all the vacant properties in the state, years in residence, sometimes loan information and types etc.

We don't advertise to clients that they should do any of these things, but the reality is that something of that nature is unlikely to create an audit issue, unless you have a frequent habit of doing so, a significant set of expenditures at the hardware store and no documented labor to install those materials.That said, one should absolutely stay away from any work on an IRA property such as painting, landscaping, serious remodel work, etc.  

I believe you mention before due diligence is a vital part of the process, and it is something I wish there were more topics on in this section on how people analyze a note and what items they look for before purchasing a note. 

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And if it's not "habitable" as-is, how about adding a 203k reno loan too?

Get in the habit of finding properties and going to see them.

Other habitable rooms must have an area of not less than 70 square feet.

If the apartment is habitable might not even need that but you already promised and the insurance i assume is covering you for that much so it is the right thing to do.

Does the available attic headroom meet the minimum requirements for habitable space?

Will the upper unit be habitable during this work?