In your case of a fourplex, option 2 should get you a better deal.I would also agree with Bill on how the number of units may not correlate with the value of the property unless it is a large multifamily complex, and sometimes a fourplex or several single family houses would give you better returns. 100% We always recommend conventional first until you can no longer qualify for those. 

If you are priced well and the condition is great barring there is not a ton of supply, then you will sell quickly!  

Nothing illegal about doing that, but if caught, the lender may call the loan due and if you don't correct the situation or pay the loan off, they willstart mortgage foreclosure.3) You could also go the HELOC route to tap the equity in the home, but the 12-month owner-occupancy will also apply AND the interest rate on the HELOC will fluctuate with the Fed Fund Rate.4) You could do a cashout refi as an investment property, but that will be at an interest rate 0.5-1% higher than owner-occupied rate.Suggest you meet with 2-3 lenders to explore your options about the above.Once you have access to funds, recommend you buy a 2-4 unit with 20-25% down. - You can buy owner-occupied, live in one unit, and fix up and rent the other unit(s).- If you're handy, recommend buying a property in the worst condition you can tolerate.

I highly recommend you read the SEC filing and the 1U Amendment.

If you’ve worked with trustworthy contractors or subcontractors in the Jackson County/MO area (especially those familiar with investment properties), I’d love your recommendations.

Here's a couple practical steps I'd recommend to help make your decision:1.

I recommend renting it as a 4/4 and being clear about the set up. 

Connect with as many brokers as you can is my recommendation.  

Most of our newer investors approach 2-3 lenders to discuss loan options.Some lenders recommend making your financing inquiries within a 45-day time period to avoid larger drops in your credit scores.All the best!

I do not recommend paying any upfront fees, unless it's with a large bank that typically requires a good faith deposit on larger transactions.