When you do LO, here is no DP involved. 

Thank you,Eric and Ashley  10 miles is a long way but if the current appraiser isn't going to move, I would have your LO or Broker use a different AMC and order a new one.

I’ve used one of these (LO), and applied with another (Corevest, but my DSCR was off).   

You shouldn't be doing any rehab if you're doing a LO.Second, are you doing a "one way" LO, or a "sandwich" LO? 

I agree that it makes sense to stay safe early on.Something that most seasoned listing agents know, that you may not know, and that your LO may not have told you, is that most triplexes and fourplexes in the SF Bay Area at MLS prices will not meet the FHA "self sufficiency" test.

Honestly, I'm surprised your LO is on board.

@John Bianco is highlighting that essentially you’re “buying your rate down” @George Liu you’ll have that flexibility with any institution pending you’re dealing with a competent LO/broker.

It seems like $15k down for a LO is high and they may not agree to that and I would prefer not to have to deal with Dodd Frank and having to go through the legal steps to actually foreclose on the property since I will be moving out of state. 

I asked how that came to pass, I was an LO as far as I was concerned, zero interest in 'managing' anyone or anything but my own stuff & my assistant.

If you're willing to take that risk tell your LO to let your rate float until it hits a certain percent in either direction.