Both of these are incurable defects that require a discount vs. an otherwise identical property away from these defects. 

And if you are out there screwing people they'll probably find a way to reach through the entity to sue you for negligence or fraud personally.  

Occupancy requirements are usually set in the note, but simply state owner occupied, that definition is determined through laws dealing with mortgage fraud and intent of a borrower.

You aren't just dealing with RE laws, you also have consumer laws, finance and banking laws and beware, bank fraud doesn't require a bank to lose money!

Not a formal appraisal, but an identical process and result without the cost. 

And the penalty for fraud is different.  

Go to the Fair Trade Act, Fair Trade Commission, the Uniform Commercial Code, RESPA, Dodd-Frank, the SAFE Act, the Consumer Financial Protection Bureau, gosh, there are dozens of laws that can be applicable but bottom line, malice, ill intent, fraud, deceptive trade practices, misleading others, taking undue advantage or just plain cheating someone. 

If not can't prove identity therefore denied in my process.

If you "do everything" you will have less of an identity.  

With a one phone call turns out there was a FSBO for 10% less in the same complex with the identical floor plan and condition etc.