If you were to charge your family a really low rent, say $100/mo, the IRS would classify the home as a primary residence and some or all of your expenses would be disallowed.

Long story short, they didn't want to classify the house as a rental, never gave us leases (despite me begging)... the room mate's pets destroyed carpet and was a major pain to get rid of.

Some condos are classified as condo-tels....that makes financing a little more challenging.Shores of Panama had some legal issues with the developer a while back.

For that reason, some classify it as predatory.

@Maxwell Lee,  I could help you clear up some key points w regards to classifying a property.

All over Pierce County there are residential code levels that cause multi-family homes to be classified as a single family home.I just researched a property for a client to figure out the same questions you have.Example: Lakewood, WA Single Family home has two properties with separate addresses.

You could focus on community banks, but even then, chances are slim they will fund something without any income stream.Any lender will have to classify your loan if they take you on, and unless you have a very well established relationship with your banker (which doesn't sound like you do if they refuse to renew your loan) they won't bother writing this kinda stuff.

Rentler is KSL.com's classified section for rental homes.

Had I come across that in an examination it would have been classified at the least (a bad gig).

Nor is every property classified the same.