You were never going to find a bank that would loan you 80% LTV on a 2-4 unit house, as almost all conventional 30yr residential loans must conform to Fannie and Freddie guidelines, regardless of the bank. 

Therefore the site would have non-conforming rights to have 2 single-family dwellings at the site.A building permit was recently issued for a residential alteration at the site... xxxxx"There are two separate structures on the site (one being a duplex and one being a SFH) as she mentioned but I am curious if it would it be impossible to legalized the downstairs unit now since the zoning has been tightened. 

@Taz PatelDid the notice conform to the statute requirements on wording?

I'm at the beginning of this journey, and right now I'm relying on the conforming loans to finance my budding empire, and keep reading that an LLC complicates that aspect.  

Sorry I have never seen a product like that from non-conforming lenders.

You might want to connect with a broker in your area or a lender with non conforming lending products.

The trust account may have to conform to special rules according to your state and local laws and regulations. 

I think what you need to look for are local portfolio loan lenders, meaning they offer products ( loans ) that arent being re-sold on the secondary mortgage market ( fannie freddy conforming loans get sold ).

Since you are below 4 doors you can go with a conforming loan (Freddie and Fannie) but will be required to put 25% down.

No I’m not saying it’s illegal just that conventional conforming residential loans for owner occupied permanent residences are different than loans for investment properties.