Do I have to legally disclose to my boss that I will have my sales agent license and have a brokerage sponsor that is someone different outside the MF development company?

Depending on your debt to income, you might have to sell or have an executed lease to secure financing to buy the second home.

Do not rely on it for legal advice.

Or paying off my debt, while I provide them with a nice house to live in instead of an apartment. 

I’ve taken care of all my debt and am pre-approved for roughly $220,000.

I'd consider real estate debt funds and private lending but that's not on my immediate radar right now. 

This is something their screening probably would have caught, or their system would have a legal procedure to deal with it.

The 2-3% points in extra cost are worth it if you plan on using as I described above because the use would be for a few  months at most and due to that short term use you can survive a rate adjustment up.But, if you have no plan to payoff the debt like when using for a down payment on a long term hold why pay the extra cost for flexibility and have the additional risk of the adjustable rate with the amortization looming when you can get a fixed rate second mortgage. 

I literally laughed through the phone at his suggestion, because I was broke, in debt, and in every way and unqualified borrower, and the lending environment in 2012 was probably stricter than it had been since the invention of the 30yr mortgage.

It separates your personal assets from your business, providing a safeguard if any legal issues arise related to tenants or the property.