I second the suggestion of retaining a geotech engineer.

These options may provide additional funds to supplement your cash reserves.

Additionally, the potential for value-add opportunities such as adding a ministorage or other high cap rate investments in the future could further increase the overall return on investment.Considering the potential for appreciation, the current NOI, and the future potential for additional income streams, this property could be worth considering as a long-term investment, despite the initial lower cash on cash return.

I highly suggest that you tune in to the BiggerPockets Podcast and connect with the local lenders and brokers of the market you choose.

You might  suggest they locate and use a real estate attorney to assist  with this  plan .  

Basically, i think all i need to close the door the Bedroom to the kitchen area, add an exterior door, add kitchenette, and possibly add its own electric panel.

They construct and sell houses in Florida using some kind of green technology which allows a tax rebate in addition to an 18-22% APR. 

In addition to the negative equity position, ADUs have other issues:1) the financing on an ADU is typically far worse than for initial investment property acquisition or is often not leveraged (HELOC, cash out refi, etc).

The structure can be replicated by adding an additional FLT and FLLC1 per property.Privacy:The title to the property will be WLLC as trustee of the FLT.

Here's my suggestion for next steps.