1031 proceeds have to be arranged to be received by an accomodater and not by you personally, so the first property won't work.The other 2 properties sound like they have already changed title as well & been sold so those won't qualify for 1031 either.

What a strange option and arrangement you came up with on this deal .

You are going to pay $250 26 times per year under this arrangement.

They can do whatever arrangement they agree on (birddog fees, cash under the table, some weird bottle can return to Michigan for 10 cent refund scam) as long as me and my client are not involved in their dealings, it's not assignable and it's not on the HUD-1 form I don't care what they do.Good Luck, 

The lender, not denying any of this, has verbally agreed to a discounted pay off if arranged quickly. 

My in-laws approached my wife about a business proposition in which they would finance majority of home purchases (down payments) and we would manage the properties. Now on the surface it seems like a pretty decent id...

I know there are potential pitfalls and lots to figure out about this plan, but I'm specifically curious about how this type of arrangement would affect the owner-occupied mortgage situation.

I would avoid any partnership that is not equal shares, because it can go sideways very quickly in that arrangement. 2. 

@David Ribardo and @Joe C jump in with any edits/comments you might have Purchase Price $149,900 (50K a door rule looks good) Three units total gross/month 2239 (1% rule looks good) Fixed expenses: Taxes 2517, Trash 1125 (375/unit in Allentown unless private collection deal previously arranged) Insurance: 703 Common Electric: 519Water/Sewer: 802Allentown Fee: 225 (75/unit/year) Variable Expenses:  Vacancy: 2239 (One months rent of each place, or 8.3%) Management: 1800 (50/door/month) CapEx/Maintenance: 3000 (1000/door) Total Operating Expenses: $12,930 Total Gross Income: $26,868Net Operating Income: Op Ex - Gross = $13,938 Divide your NOI by the cap rate your looking for and you have your offer price.

In exchange, they can gift her the house in their will or a similar arrangement.