Non-Legal Multi-unit

[Jason Hartman]

Hello, I've recently purchased a 4-plex in a historic neighborhood in Indianapolis, and have run into a big snag.  To give a little context, this is a house built in 1890 that was converted into four 1 bedroom apartments at the time of the Great Depression.  They actually did a good job with this, but at present, it's a big fixer needing cosmetic remodeling, but also all new systems.  I knew this going in and paid cash for the property, allowing for a better deal.  I've purchased duplex properties in historic neighborhoods before and haven't really run into big problems renovating, however, because this property was built as a single family originally, I am.  I was prepared for extra hoops to jump through, but I learned after the purchase, that the seller (who is a licensed realtor) did not disclose that the house is actually a non-legal multi-unit.  It isn't that it's a legal non-conforming, but it is non-legal altogether, and he listed it as a multi-unit for sale.  This of course impedes much of the renovating that's needed, but I'm also concerned that even if I could get the permits for the renovations, I won't be able to resell it down the road.  Has anyone dealt with this?  Do I have any legal recourse against the seller for not disclosing?
You can try to get a Legal Non-Conforming Use Certificate (LNCU) but it's expensive, very labor intensive, and you still may not even be approved.  
Any help would be hugely appreciated.