There are so many loan product options within the different conventional, non conforming, and private money categories.

So, they have MUCH more control over the kind of terms and conditions on the loan unlike a conventional conforming loan that needs to follow strict guidelines to be resold after its originated. 

Lot B is also a non-conforming lot according to zoning, <25,000 sqft.

A lot of 2/3 flats in Chicago have non-conforming garden units.

It's all about making sure that you are conforming with the lender requirements.I'm sure there are a variety of opinions on it, but buying property with less money down allows you to generally increase your cash on cash return.

If the current zoning does not conform to what is the highest and best use, you can make more money if you do the work of getting it ready for the builder but that is a long process that if you have the time would be an awesome learning experience. 

Lenders may face challenges in valuing the property, determining loan-to-value ratios, and establishing appropriate underwriting criteria.Lack of Secondary Market Support: Mortgages for condotels may be considered non-conforming loans, and there may be limited or no support from government-sponsored entities like Fannie Mae or Freddie Mac.

With conforming financing they take too long for wholesale properties most of the time.I've bought 4 duplex househacks on the market and one for my girlfriend off market with conventional financing.

Most contracts can have the verbiage "or assignable llc" in the buyer info, but you still must conform to contractual deadlines.

However, to point to the STR and state because it is less than 30 days it does not conform to zoning (or is magically commercial because it is less than 30 days) is not a case in any case I am aware of (and not how the various cities I am aware of are restricting/prohibiting STRs (they are not claiming it as a zoning violation or that it is more commercial than renting MTM)).