I also don't understand the all or none explanation of the roommate situation.I do agree, usually people who are looking to rent a room are strapped for cash and in a temporary-I-need-help type situation.

Sorry for the long post, but you all were so helpful I felt the full explanation, and any post-mortem analyses from the great folks here, might be helpful to others who may stumble across this in the future.

@John Woodrich The explanation is very much appreciated.

It can sink you doesn't matter what they did here if the security deposit isn't returned in 20 days with the letter of explanation you have to return it all to them.   

Sorry for the long winded explanation, but it seems like every decision we make at this point is overwhelming because there’s so many variables.

If it were me, I or my attorney would ask the title agent why the lien was originally referenced and what caused them to be willing to delete the reference to it.That certainly is a reasonable explanation of why the matter was raised and then removed from the title commitment. 

@Jean Bolger Great explanation, thank you.

Thank you so much for the thorough explanation.

Fantastic write up and explanation of the insides of the lending process, thank you so much!

@James ReyesMost underwriters consider 12 months to be the "reasonable amount of time" for occupancy unless there is a deployment and change of station, in part because of the 12 month mention later in the explanation.