Non-conforming deal experience? Appraisal, financing, insurance?

[Jake McKay]

Just decided to avoid a multi-family deal that had lots of deferred maintenance and was priced well to allow for some good cash flow. It was not currently a legal 4-plex and was non-conforming use in an area zoned for light manufacturing. I spoke with the city planner and there was a process to show its history of use as a residential property to legalize it, but it would still be non-conforming. 

What issues have you experienced in making deals with non-conforming properties? Things that surfaced as I did some due diligence included varied levels of risk in: being able to get the property legalized, insuring the property, being able to refinance after the seller carried the note, appraisal issues, and dealing with the type of tenant attracted to such a property. 

I'm new at the game so any advice is helpful. Thanks!