@Thomas Hickey Your question gets into the gray zone.

Everyone's comfort zone is different.

(It's been there for over 30 years) I'd like to make it a legal 4 unit but it is an R3 zoning and I had been told that the lot size would not accommodate it.

There's no room at this point for a rehabber to buy, fix, and sell without going in the red so properties continue to be used as low income rentals.  

2) What are the primary red flags I should be keeping an eye out for?

I would like to explore the options on if it's possible to get certain areas rezoned.  Any experience out there on this.  With the amount of people moving to Texas.  Seems like there needs to be more multi family. 

When I look the property up on the county website it is zoned single family.It's an older home so I assume it has been divided and added to over the years, probably prior to rigorous permitting and zoning laws.I would like to ensure that everything is legal prior to possessing the property, and imagine I would need it to be so to use the rental income towards the loan.So I guess the questions are:Is it silly to think this could be re-zoned?

@Courtney Hebert if you're interested in a 203k you might also look at the Fannie Mae Homestyle renovation loan, its similar but has some benefits over the 203k in that it has a little less red tape on the type of improvements you can make, and doesn't have an owner occupant requirement.

Monthly holding cost box stays red for me and will not load when I click the "Continue" button...

We have some attorneys that specialize in zoning and variance and don't do either of the above.