A key step in all of this is to understand what the zoning of the property is and what is allowed.Does the current/future use of the property conform to that usage.

Sometimes a non-conforming space also helps with the numbers if you can find one that has egress and safety standards met.

(By using ~$140k, you're indirectly referencing 25% of the 2021 conforming conventional loan limit, so I'm guessing you read $137,062 on a VA COE issued during calendar year 2021 that you came across for some reason and "about $140k" is what your brain stored)But for folks with no outstanding entitlement, that limit was tossed out the window right before COVID, one of my main wholesale lenders is doing $4,000,000 VA loans on up to fourplexes with 0% down as of yesterday (how smooth was that California military veterans relevant plug, and that keyword/SEO drop right there?

Its hard to understand based on your post what this fee is for, but perhaps the structure does not entirely conform to zoning requirements as a single family home or something of that nature. 2.

You cannot count any non-conforming/illegal units income towards the total income for the property either.

I am looking to get a HELOC on my primary residence. The line will be over $500k so most banks process it similar to a regular home loan.  It's been about 20 years since I have gotten a mortgage since I usually pay ca...

New builds are far more desirable, and have less total cost of ownership than many of the stick framed, pre-existing, non conforming older homes. 

Sometimes properties can use a non conforming use and be used as a multifamily property even if it’s zoned as single family.

PennyMac will definitely not allow this.They do conforming loans, conforming loans cannot be in an LLC.You would need to refinance into a NON QM Loan.I would consider a DSCR Loan depending on the LTV and your DTI.With a low LTV a DSCR Loan can price out the same or less than a conventional loan.You then calculate how many years worth of tax savings it would take in order to recoup closing costs to see if it's worth doing it.Feel free to reach out I can give you a quote in minutes with no credit pull.

Does anyone know if a tenant living in a non-conforming basement unit can get renter's insurance?