In fact, if that LO does the side-by-side showing the rate/payment advantage of FHA (particular to her), and suggests to Sally that she should consider the conventional loan with (for her, due to aforementioned reasons) the higher interest rate and higher monthly payment (to open the door to more condo developments, to make it easier to have her offer accepted, etc), there's a very good chance that Sally will suspect that the LO is out to get her, or nefariously upsell her, possibly over those very same things (whatever that might be) causing her to have had a harder life (ask me how I know). 

I find it rather efficient to be an LO and investor.

Tagging my favorite LO @Wyatt Wolff

Again, lender specific, so all great things to ask your LO!

(assuming the ADU us subordinate in size etc)  Maybe your LO is quoting it as a multi which has higher rates. 

Tagging my favorite LO here for more insight, @Wyatt Wolff.

And if the LO doesn't work...they got $5,000 and can put the house on the market and make another big chunk of money.

I was told by at least a dozen people that renting out a basement was illegal, and lo and behold I decided to look into it myself (and it's not).

I am an LO at a DSCR lender known as Easy Street Capital.

Tagging my favorite LO @Wyatt Wolff - cheers!