Many will disagree with me on this, but I have personally originated several loans underwritten with Fannie Mae for conventional financing and accomplished the financing when there are 4 leases for a 4 bedroom SFR. 

Hi Jason, For conventional loans concerning rental properties reported on your PERSONAL tax returns, underwriters will calculate your net rental income based on your Schedule E from your most recent tax return (using Fannie Mae form 1038), depreciation and depletion can be added back in to offset the expenses of the property.  

Its a good question and lots of resources here on BP to learn - generally going the "conventional" route with mortgage loans from private lenders that conform to GSE (Fannie Mae) standards is great for your first few, then many switch over to "DSCR Loans" when they start scaling towards property number 3,4,5 etcI recommend talking to Jeff Welgan at Bluprint home loans to talk to to learn about the conventional options https://bluprinthomeloans.com/jeff/Also feel free to check out these resources on "DSCR Loans" which don't use DTI at all and are really good for scaling:BP-Published DSCR Guide!

Freddie Mac & Fannie Mae multifamily loans essentially offer low rate, high leverage, non-recourse permanent financing options that are backed by the full faith and credit of the United States government.

Keep the majority of your money in your accounts $1.5M liquid reserves is a ton of cash so let it earn you interest.Use the Banks money to lend on a multifamily use a Fannie Mae loan its only 5% down but you can put more down to meet your target monthly payment.

Options include:Renovation Loan (FHA 203(k) or Fannie Mae HomeStyle) to cover both home purchase and ADU construction.HELOC or Cash-Out Refinance if you have equity in your home.Construction Loan specifically for building the ADU.This post does not create a CPA-Client relationship.

Fanny Mae does have a 5% down owner occupied loan program for MF purchases.Any thoughts? 

Being that my year living here is coming up, I was hoping to refinance into conventional and buy again with the 5% Fannie Mae. 

If its' long term appreciation (which I'm personally not a fan of betting on) you can look at it as, if you put a small 3.5% down payment using FHA or Fannie Mae, and your property appreciates on average at 3% a year.

For example in wildfire areas here, buyers aren't able to get traditional homeowner's (or rental dwelling insurance if an investor) insurance and conventional Fannie Mae and Freddie Mae loans.