If it is an FHA loan or a bank that requires you to make it your primary home, then yes, that would be a requirement or it is likely fraud.On the other hand, if your financing doesn't require you to occupy the property, it would be an "arm's length transaction" since you are buying it from the bank, not from your friend, there are no restrictions on what you do with the property after you buy it.

But basic question - there are eligibility requirements (related to service in peace corps or armed forces) for VA loans, correct?

I purchased a duplex 2 years ago for 20% down / $560k on a 10 year arm at 2.45%.  432k still owed on the home. 

The chief tax assessor in the Beaver County courthouse said that because it's not an arms length transaction and I'm transferring it essentially from me to me, that I could avoid transfer tax.

Children are more sensitive to these things and would probably grow an extra arm out of their head or something. 

I re-read the whole contract yesterday and don't see it saying explicitly anywhere that it's limited.  

I have a 10 unit, 6 unit and 4 unit all with a 5/1 ARM, 10 year ballon, 20 year amortization, current rate of 5.25% (set to start adjusting in 2 years).

Even if you're willing to pay $2MM, if that's not an arm's length transaction, you may not get financing for that purchase.

One investor I know said a few years back, "I've been getting 5 year arms, 10 year balloon, 20 year amortization, 80% LTV at 4.5% for my last 2 commercial loans. 

What you pay is, by definition, it's value.I'm not seeing 3% loans (other than ARM) quite yet.Vacancy is way too low.