Then we purchased it, we did so as a second residence and there was no reliance on the rental income ... we did this to avoid the dancing with several lenders before finding one who would underwrite a student rooming house.  

When people "sell" their house to a "buyer", they start to act in reliance on that "sale."  

Forman (1975)).If all three of you are active participants in the business, for example, you all make the decisions of the business together, then there is no reliance upon the "efforts of others."

Although I respectfully disagree, we both know this isn't the appropriate forum for a discussion on the application of the third prong of the test, or whether a local Judge would expand prong three to include situations in which, on reliance on advice that denotes an understanding of the law, a person acts on and is harmed by the advice of a lay person in another state who is not licensed in Virginia.

On the one hand we have buyers of new (or replacement) houses who must have loans in order to buy the home they want.In qualifying for the new homes, they must somehow dispose of their old houses.When money is "tight", the sale market slows down, placing both the builders (and their lenders) and the buyers (who must first sell their existing residences in order to qualify for a loan) into a quandary.At the same time, a portion of the market (investor/speculators) willing to absorb the surplus houses is prevented from doing so because of the same shortage of mortgage funding.The solution lies in creative financing techniques.Read on.The following pages address themselves to this parallel dilemma of the market, the builders, the lenders, the buyers, the sellers, investors and speculators.For the agile investor, CommonWealth Letters have a slogan: "THE GOOD NEWS IS THAT THERE IS BAD NEWS".In so many words, what that means is that in tough times, when credit has dried up the markets, only those who have cultivated buying, selling, fixing, management, negotiating, and financing skills survive and prosper, but, when we have prosperity in the United States, it is possible for ANYONE to succeed.Our markets are so vast, our citizens so affluent, our institutions so liberal, that practically every form of commercial activity has a theoretical and statistical chance to succeed.The problem with that scenario is that good times cause millions of would-be entrepreneurs to enter the market place.Success becomes a very competitive venture in which those with true ability are virtually in-distinguishable from those without the skills and knowledge normally required as a prerequisite to prosperity.Thus, our endeavors receive only average returns even though we might be able to contribute above average talent, energy, drive, capital, and imagination.One of the principal reasons for this is that venture capital abounds in good times.Lenders woo the untried, unskilled, untalented in an effort to place the ever increasing funds deposited within their coffers.Interest rates fall as money chases borrowers.The costs of doing business are reduced correspondingly as the cost of money falls, (then they are raised again as the costs of labor and materials escalate to meet increased demand).The ebb and flow of money and production instills a cyclical rhythm into the economy; and just as Winter follows Summer, so must hard times follow the good.In hard times, the reverse of the above holds true.Slowing economic activity causes businesses to retrench.The faint of heart drop out, others cut back on costs, materials, and labor.They slow down their payments to the banks.They with-draw surplus funds to meet current expenses.Bankers, seeing their reserves beginning to diminish, are faced with increasing loan demand from borrowers who foresee less and less certain profits with which to repay them.Interest rates are increased to meet market demand for money.Loan terms are stiffened to discount increasing risks.Money becomes tighter and tighter.Now many of us who have been waiting on the sidelines begin to see opportunities.Those builders who need buyers, those buyers who need new homes, those speculators who are stretched thin with negative cash flows; throngs of those who knew how to prosper during times of business expansion become listless and drift during periods of contraction.Our opportunity derives its strength and vitality from our being able to function in the market place without reliance on any financial institutions.Our competitors, who in prosperity were able to divert many opportunities to themselves, swiftly find themselves "on the ropes" when their lines of credit are withdrawn, because the key to their vigor was easy credit.Without readily available financing, they become ineffective.Phrased another way, those who choose to depend solely upon institutional financing will always find themselves trying to make a profit in a competitive market situation.They will be "in-phase" with millions of others, condemned to mediocre success, dependent upon good times to afford them enough of a living to be able to weather the slow periods.On the other hand, THOSE OF US WHO LEARN HOW TO PROSPER DURING HARD TIMES, WITHOUT THE HELP OF THE BANKERS, WILL BE ABLE TO OPERATE IN A NON-COMPETITIVE, PROFITABLE ENVIRONMENT.

A majority of the populous had some reliance on the social welfare system in some form or fashion for some duration, be it gov. spending on infrastructure projects to create jobs, food allocation systems etc..

A reliance on single industries (manufacturing) has really disadvantaged wide swaths of Central New York. 

I would never place too much reliance on a HELOC for reserves (They are better used for new acquisitions than reserves).Sorry I am so wordy but this is an issue that has a ton of misconceptions.

Dependency has never, not 1 time in all of human history, ever once, breed INDEPENDENCE, strength or self-reliance.

(B) For the purposes of this paragraph, a person may only show good faith reliance on the application of the exemption by showing that--(i) such person has no actual knowledge that the facility or community is not, or will not be, eligible for such exemption; and(ii) the facility or community has stated formally, in writing, that the facility or community complies with the requirements for such exemptionSec. 808. [42 U.S.C. 3608] Administration(a) Authority and responsibilityThe authority and responsibility for administering this Act shall be in the Secretary of Housing and Urban Development.