For this 2nd property, my previous lender would give loan with 50% - 60% down payment, 5/1 ARM 6%, 1.5% points.

So in this case if you are thinking about this tenant then you force will be income, and making sure they are planning on being here the lease term time or more. 

Secondly, once you can force the value up sufficiently, have it re-appraised and do a cash-out refi based on the new market value.    

20 years old, armed with a RE License and BP.

well you can't force someone to fix their property unless it's considered a nuisance in city ordinance. 

in most mortgages, there is a " due on sale" clause. which means the bank can demand payment in full if you sell the house. granted, yes, here, he is not selling, so the bank my not force the right to due on sale. but they may. should they have to foreclose anytime in the future, having a name on the property different than the name on the mortgage could, and probably will put several more steps to the foreclosure for the bank. thats something they are not going to be happy about. if i were him, i would check into refinancing the property. see if there is any equity in the place that he could pull out and use to further his real estate world. at that time, put a different name on the deed, everyone is happy and he walks out of the deal with some cash in hand

They're forcing upgrades.

The best thing about outsourcing all or most of the day/day labor is it forces you buy/negotiate better deals.   

The days of the CO forcing members to pay disappeared a long time ago.  

Oh, and to answer your question @Nicole Harrington, maybe they are looking long term and at forced appreciation and just trying to take advantage of low mortgage rates.