I am not saying my strategy is the best nor do I think it applies to all properties during all parts of the cycle.

RESPA and this part apply to federally related mortgage loans, except as provided in paragraphs (b) and (d) of this section.

Previously, under the Chevron doctrine, when a court determined that a statute was ambiguous or that Congress had not directly addressed the precise issue in writing a given law, the Court, rather than applying their interpretation of the law, would instead defer to the regulatory agency’s interpretation.

if I apply for the lending on my own. 

I plan on saving my income and applying for a FHA loan next year.

I applied for a loan with my local credit union, but they called me to ask about the purpose of the funds.

It's a wealth development book that isn't directly related to real estate but can easily apply to real estate investing.

The big problem on this type of coverage, for you as the Mortgagee, is that depreciation will be applied to any partial loss.  

If there is a legitimate repair needed on a property that's documented at closing, would the limit not apply then?

The Theory is this:(Quoted from VA.org: Those who apply for a VA mortgage with another veteran (a VA “joint loan”) may be permitted extra units for business purposes, which means your multi-unit property could have more than four units.