Buying 1st Investment Property Loan Issue

[Tracy Dauterman]

Hi, My husband and I are days away from closing on our first investment property out of state. (We live in CA, property is in OH.) We are approved for a conventional 30-year loan with 20% down. Our offer of $80k was accepted. We are supposed to close on June 27 but now our lender says he can't close until the detached garage is painted and roof replaced. Sellers agreed to our price with an as-is sale only. 

We're talking to our realtor tomorrow. I'm going to ask if seller financing is an option. I think the seller owns the property free and clear. We have excellent credit. What are our other options? Hard money? Hard money then refinance? 

Also, our lender advised us to buy this property as a second home that we'd be living in for a portion of the year in order to get a better rate on the loan. Our insurance as of now is quoted as if that is what is happening, even though we have no intention in living in this property. I was going to change the insurance so we have the appropriate coverage after closing but this seemed a little fishy to me. Anyone else do this?