I would say that I subscribe to a modified version of his seven steps.  

A basic HI doesn't know framing and may not notice a modified truss in the attic for instance, but that is an important and costly repair.

I just posted this on a similar post, but will modify it for your specific situation:Allow me to be a counter-narrative.

I have an extensive negative keyword database, good handle on modifiers.

YOU should be the one to determine your market and whether or not it is profitable to take that loan or modify the terms.

I am in the process of getting an REO under contract through Fannie Mae, and LAST MINUTE they sent me this bogus Real Estate Purchase Addendum that TOTALLY negates the terms in our agreed upon offer.....My agent is telling me its "standard" - but I am refusing to sign unless it can be modified in a way that doesn't contradict VERY IMPORTANT TERMS in our agreement.

Owner-occupancy shall not be required if the owner is another governmental agency, land trust, or housing organization. (3) Require the recordation of a deed restriction, which shall run with the land, shall be filed with the permitting agency, and shall include both of the following: The word at issue is 'Notwithstanding' which modifies the first section in light of the next.

If your expenses are greater than the rent, than you get to deduct the loss against your income if your Modified AGI is below 150k. ( unless you qualify for RE pro and it’s requirement) There is not tax benefit if your have net income.

I might modify the add to be sure to include that you require a rental application to be filled out.

Not sure about mainland US but in Hawaii worst case that could happen is a neighbor reports some type of building permit violation to the county - and then the county requests to inspect the property, sees something built without a permit, and then sends the property owner a notice to modify the property to correct the issue. if the property owner doesn't correct the issue after a certain period, they start fining the property daily.