We have had a few hiccups along the way with an old fireplace that prevented us from opening up the kitchen/dining wall to create a big open space, and so we've had some design changes out of the gate, but still moving ahead.

Also not a deal breaker for me, but I would most definitely get it graded and put down new material.I would suggest ground asphalt if you can get it.

I do want to provide a safe living space, so I'm doing what I can to prevent bat visits from reoccurring.

You are allowing them to effectively buy good credit with you, vs. meeting your pre-established standard.Having said all that, there is nothing to prevent accepting a multi-month rent payment when their second month becomes due.

They may have a clause in their mortgage that prevents them from selling to someone else while they still owe the bank.

Check to see if zoning or HOA rules, if any, prevent you from subdividing the lot. 

Most of the COVID programs allow for back rent to be paid to prevent eviction.  

I see it as just another stumbling block and preventing people to actually get started.

And then the rent becomes very expensive after that to prevent holdover?

Here in Georgia we've not hit the problem but the leases I have do contain a clause that if the temperatures go below freezing the tenants are required to allow faucets to "drip" during the night to prevent pipes freezing.