Again, please confirm this with your lender. 

(1) IRC Section 1445 places the burden on the buyer to confirm the seller isn't a "foreign person" as defined by the code.

This is coming from a lead Sponsor, not a CPA, so reach out the your CPA and attorney to confirm. 

They definitely look at your reserves.   

I am currently rebuilding my reserves but don't have much at this time.

Also there should be some reserves for "Capital Expenses" These are things like a new roof or new water heater that don't happen very often but they will come up eventually.

Keys are getting the property at a good price and huge reserves.

Having that additional money can serve as reserves on the property or will help get you into your next one. 

203k has limits on what you can fix - sounds like your list is fine. 203k you are stuck with 1.75 mortgage insurance until the value goes up enough to refinance to conventional- thats the big $ difference. 203k allows lower 580  FICO score and I can go to 49% back end ratio if you have combo of 12 months reserve money plus FICO 660. 203k 3.5 % down.

However, the Cashflow produced by a handful of properties is enough to cover that expense on an annualized basis.My goal is a cash out refi to source the funds, keeping the Cashflow as further reserves.