Remember the boy and girl conversion mostly accepted in California… but for something like AI the biggest front would be on the market where it is not regulated but tech savvy…USA is just too complex to adopt AI, the political powerhouse is still thinking in 1965 climate

I heard of a situation (I forget the institution name) that also had the same set up as Baselane.

Look for a farm credit ("FCS") institution nearby.

Now it's stable, and time to take out the hard money with long term institutional debt.

This approach involves risks and considerations, including due-on-sale clauses in existing mortgages.Credit Unions and Local Banks: Sometimes local credit unions or community banks can offer more flexible terms compared to larger institutions.

They can provide guidance on potential legal options and rights concerning the city’s demands and the lender.Negotiate with the City:Seek Extensions or Variances: Your friend can request an extension on the deadline to comply or apply for variances that might allow the property to meet less stringent requirements.Explore Grants or Subsidies: Check if there are any local, state, or federal grants or subsidies available for renovating older properties, especially those providing low-income housing.Engage with the Lender:Discuss Financial Hardship: Present the case to the lender, explaining the situation and the financial hardship imposed by the new building codes.Propose a Loan Modification: Suggest modifying the loan terms, such as extending the loan period, reducing interest rates, or even deferring payments temporarily.Negotiate a Short Sale: If the property must be demolished and rebuilt, your friend can discuss the possibility of a short sale where the lender agrees to accept less than the owed amount to avoid foreclosure.Explore Refinance or New Loans:Seek New Financing Options: Look for other financial institutions or private lenders willing to provide financing for renovation or rebuilding.

Second, if the above were true no loans would ever get sold in the secondary market.Some institutions MAY have a policy of not discussing their mortgage holdings unless under specific conditions.  

When my amendment was ignored after its expiration after 4 business days, I filed a dispute with my financial institution to recoup my course fees.

When was the zoning changed/adopted to make this property SFH zoned?

Yes, get your financing in place example DSCR loan/financing ect. and speak with a Lender or your bank/financial institution about your finances and investing in real estate.