What they're wondering is if they could sell their lot to the same developer who buys the tear-down, allowing the developer to get extra value by increasing the lot size.

I assumed the same rent range and only slightly more than $40k, mainly because of an allowance for windows. 

I use an early termination clause that allows early termination of a lease should the tenant pay a fee equal to two months of rent.

I have allowed all of my credit cards to lapse and close after 2 years of inactivity (except 1 I've had since '91). 

For a PM to allow a tenant to get so far behind before filing and getting a judgement  is not my definition of "knowledgeable" or "timely." 

If the HOA allows them to put the kitchen in and create an ADU then they will have a pretty good argument that the HOA is allowing them to use it as an ADU.

Those still might not be allowed with HANO, I've been trying to check on that.Any other ideas, wise folks from BP?

Bear in mind that conventional lenders allow you to use part of the income from the building to qualify for the mortgage.  

To address your cap limitations, there are lenders that will have specific low down buy and live in programs with competitive interest rates that allow you as an owner occupant to finance a 4-plex as long as your live on site for a full year. 

They are not allowed to 'advertise' their services directly here, so what I did was reach out and give them and call to see who is the best match to you.