Loan programs that utilize AirDNA income projections to qualify can also be utilized for cash out refinances (if not currently operated as an AirBNB) although some lenders have a maximum cash in hand of $500k-$1M typically at a lower loan to Value of 65-75% for investment property vacation rentals. 

The facebook groups are a great place to find mentor programs and such in your local markets 

There are advantages and disadvantages to it and those can vary by the local housing authority that administors the program in your area.

Government Programs and SubsidiesYou might qualify for programs that offer incentives, especially if you're investing in areas targeted for development or revitalization.

But each bank/loan program has their own requirements so you should also double check with whatever loan officer is submitting her application.

My tenant has used the housing assistance program this year.  

Wait until Harris introduces the 25k first time buyers assistance program. 

It's possible that they are turning up the heat to the maximum because they are part of a utility-subsidized bill program.

If Planning does determine the existence of your ground floor unit, it will require you to legalize the unit through the existing Planning code process assuming zoning supports the third unit OR using the new ADU program making your fast track condo conversion a passing dream.With regards, to some of your latter comments and questions:1) Any un-permitted work (including corrections) is not a good idea as a quick compliant from a neighbor can bring an inspector knocking on your door with a NOV especially in the current environment where everyone is SIP.2) Legalizing existing constructed spaces can be hit and miss based on the inspector you get.

Local grants and first-time homebuyer programs can help minimize upfront costs.