I know in Norfolk it's considered "non-conforming use" even if zoning changes assuming the use isn't discontinued for a period of two years.

@Greg HendersonThat limit should be for conforming loans only.In my layman's opinion, I'd advise against quit claiming the deed back and forth. 

If you are purchasing in your own personal name, you might qualify for a traditional Fannie/Freddie type conforming loan.

@Will Guy Generalizing a bit and trying to put this very plainly, if you are seeking a conforming, residential mortgage for this transaction, it is probably not going to happen with you closing it in LLC.

Adding an egress window to a non conforming bedroom to make it a legal bedroom for example. 

If keeping the owner occ loans long-term and moving on to the next deal(s) as owner-occ, you will run into tougher guidelines on your 5th property and then you are cutoff from conforming financing after your 10th (as was mentioned above. 

Probably your best bet would be small local banks and credit unions and try and drill down to someone there in the commercial or non-traditional real estate lending department (not the Freddie/Fannie conforming loan folks).

Used to be double and now it's only about a 20%-30% premium for non-conforming.

Below is a 13 month chart showing $/SF for all conforming rental properties.

If you haven't maxed out your Fannie Mae Freddie Mac conforming residential loans I would do that first.