We already pay a higher rent rate then our BAH covers.

Get a contract to cover your time and resource to "lay the foundation."

I cover Texas.

Looks like it is a fee the sellers usually covers and the items found on the inspection have to be completed by the buyer on a certain date.

While we certainly have the new property insured because it's primary use is for short term rentals my primary insurance company won't cover it.

Seller will not give enough to cover expense.

If you're going the umbrella insurance route, make sure it will cover you for several things including just the routine slip and fall.

@Michael Pursell @Jonathan R McLaughlin is right about the liability, which made me think about homeowner's insurance.Be sure you talk to your insurance agent about whether an "unofficial rental unit" is covered or needs a different kind of policy.If there was some sort of claim, it wouldn't surprise me at all to see an insurance company deny the claim if it wasn't a legal, permitted ADU.

I usually just adjust my offer accordingly to cover the expected costs.

@Pandu Chimata There are a few other things that the Underwriter will require in order for you to get the Primary residence (Owner Occupant) loan rate.1) You will be required to sign an Owner Occupant affidavit, This document basically covers you legally stating you will occupy the property within 60 days of closing escrow, and you will occupy the property for a minimum of 12 consecutive months from escrow date, and you will not rent, lease, or sub-lease the property within the first 12 months from the closing escrow date.2) The other thing that often gets asked is, How far away from the current primary residence is the new property?