Then I donate the toilet to the local Habitat for Humanity Restore for a tax credit.  

However, the seller claims he purchased the property as a two-unit dwelling based on Baltimore City public records, yet it’s not legally permitted as such.

In the parlance of the Federal government, such loans are called loans on one-to-four family dwellings.

Lead Certification billed per unit $200-$400  (depending on company you use) every 2 years3.HVAC Certification Billed per dwelling unit $100-$2004.

Its just human nature to buy or change lifestyle as one gets more successful but not at the expense of pilfering the projects. 

This is why people don't like renting to friends/family because its human nature to mix emotion into the decision making and that makes dealing with managing the investment messy when things go sideways.

Here's what I find most interesting.Section 29-35-103(2)(b) of the ADU law says Colorado cities can NOT "require an ADU or any other dwelling on the same lot as an ADU, to be owner-occupied."

Even though this wouldnt be purchase money financing, ultimately your loan would be secured by a dwelling, rather than by real property owned by a commercial entity for transactional purposes.

In my city's codes and ordinances it states that one of the common rental property violations is having "over four unrelated individuals residing in a dwelling unit" would the dwelling unit be considered the entire house or just the part contained in the lease (aka the room)?

If there were a serious insurance claim, god forbid human injury or loss of life, and they do the same research discovering the non-conforming construction of habitable space, why would they bail you out?