No doubt if the borrower is not paying the HOA they will not paying the first mortgage and in this market of severely underwater homes that is their bond to break.

My plan is to take the detached garage and turn it to a casita to also rent out while still living in the main property to offset the increase in mortgage from the refinance.

Here are some numbers185k PP = $1400 mortgage ARV=220Rents for 2500-3000 a month Saving 15%-20% for M&R, Cap Ex, VacancyIt will CASHFLOW very well...

However, it's crucial to differentiate between capital improvements, which can affect your tax situation and potential interest deductibility, and mere repairs or maintenance, which do not.Furthermore, the mortgage interest deduction is capped at interest on up to $750,000 of debt, a threshold that encompasses both your primary mortgage and any additional secured loans.

I pay $1000 per month on my own mortgage.

If house hacking doesn't pay the whole mortgage, that's ok, it's more important that your mindset is thinking as an investor and not a consumer.

Looking to place the property at $495k and have about $240k left on the mortgage.

Many people who choose to self direct their retirement funds choose to become a private lender and either go through brokers who pool money together and loan short term to fix and flippers as an example. 

Focus on maximizing tax-deductible operating expenses associated with your rentals, such as repairs, property management fees, and mortgage interest.

Our budget is about 450k or <3500/month; this is what we can afford if, when we rent it out, the rent doesn’t cover the entire mortgage.