If you're refinancing to a business purpose loan that's totally fine, but chances are good you'll need a lease in place for the unit you were occupying so the lender feels confident that it's strictly going to be used as an investment property.

Hi Mike,I don't know the specific answer to your question, but the dirt cheap bare minimum 'online' brokerage that I've seen a lot of people use, after spinning their wheels and doing a bunch of research, is these guys.To align expectations: you get what you pay for, which in your case may end up being 100% perfectly fine.

They can & will impose fines until you stop. 

Fine, no big deal.

As I mentioned above, the risk of being sued, found guilty, and fined more than your insurance will cover is almost non-existent. 

And, they generally bring forth action when a neighbor files a complaint and the fines/remedies can be painful. 

If so, I anticipate that the other two tenants may ask the one responsible for the bedroom above to pay for most or all of the costs, which may be financially burdensome for that tenant.While I have the plumber’s report confirming that the pipes are fine, I do not have definitive evidence that the leak was caused by the tenant’s actions.

Or just have a tenant sign a move in inspection docs that states everything was checked by tenant and is working fine?

If you don't provide the information that's fine, but it would be a transparent answer.There are hard money lenders who underwrite to DSCR standards with their own rules, and commercial loans with use DSCR in various  applications. 

One city near me is checking all garage enclosures, giving nice notice to get them permitted, which they may or may not grant, and if you don't get it properly permitted by December 31, says they will start fining people.