I understand that they are looking at income and assets… my question was specifically about how mortgage companies view depreciation on existing properties… It depends on the loan product, do you know what the specific loan type / mortgage lender you are working with?

There is a lot to it, so it's going to be an 'it depends' kind of answer.

If so, then what I would do is- 1) You mentioned 'wooded' lot, so depending on how much wood we are referring to, I would seek and get bids for selling the wood (I dont imgaine it would be much if anything at all cosidering .34 acres) additionally, you don't want to get rid of every tree; 2) When you split, you can certainly put restrictions in the new deed, i.e. any future structure being build most be between 1,000-1,500 sq.ft., must be single-family use... etc., etc. 

More DSCR lenders do suburban STRs, but some can do rural as well, the best lender for you would really depend on the property details and your long term investing strategy.

The tricky part is separating out the smooth talking contractors (that suck) and the capable, dependable contractors. 

How to respond depends on whether you want to keep him as a tenant.  

The HELOC has a start rate of Prime 8.5+ 3 ish, depends what your FICO is.

I am an investor in the Sedalia market we handle both buy & hold and rental properties both are good in this area depending on what you have location and end goals.

Conviction could possibly depending on the nature of the crime.

We agree that it absolutely depends on your design intent, including the number of stories and square footage, hillside vs flat and overall level of custom detail desired.