If the seller subordinates his seller financing and mortgage to the institutional lender you won't have a problem.

I was also going to point out Detroit.. prices peaked there in the late 80s and into the 90s when I did my very first out of state ( for me ) lending for BRRR buyers it was Detroit and it was circa 2002 to CA investors. 

I work both as Realtor and lending.

You need a pre-approval letter from your lending institution. 

I know most residential lenders won't lend to an LLC so my question is should I just house hack the way anyone else would, using my own personal financial status and name, my own funds for the downpayment, and put the multifamily entity and principles aside for now.

Have you tried reaching out to your states office of financial institutions.

I founded First Access Lending to provide access where others can't.I can write second liens up to 80% CLTV on investment homes, sometimes with rates lower than cash-out loans, AND you get to keep the low rate on your first mortgage.The products are rare, so I'm not surprised to hear other lenders saying they don't offer them and/or recommend other products.Let's connect, and I can give you a quote!

How risky are there. being the one lending the money for three years

Institutional investors are returning to the market, evidenced by increasing transaction volumes in July and August.Supply dynamics vary across regions, with markets like Chicago, Milwaukee, and Pittsburgh benefiting from limited inventory growth below 2%.

Due to my background in consumer lending, I am highly skeptical of paystubs and other address verification due to the widely available websites that are out there to generate forms relatively easily... so I like to verify the information by contacting the listed employer using their listed number on Google to avoid possibly calling a friend etc.