If your criteria says that each adult must qualify on their own, and these guys don't, then you deny.Plus, whenever you can legally deny anyone going through a divorce or just freshly out of one, it's the thing to do.  

I am a newbie and trying to get some advice regarding how many adults and children can comfortably live in a 2 BR, 1.5 bath rental unit in a duplex.

Now, however, they have discovered that the 15 year old sister of one of the two adults named in the lease, has been staying there.  

Could a parent buy a home for their adult child (who could not afford it on their own) to live in and get the same 5% down/owner occupied financing rates?

The one Sheriff at the door literally grabbed him by his shirt and placed in on the sidewalk outside the front door and he stepped inside. 30 seconds later, saw four adults leave the house - nothing was packed - after 5 months of hell from these people.

But allowing people to live this way, not teaching them to be  responsible  adults is not helping them.  

I told him I am not the Army and we're all adults. lol

In order for people to become responsible adults you need to make them accountable for what they do in life. 

Sadly, the topic that finally motivated me to create an account and jump in is not a happy one:We have an adult, non-family-member guest living in his own RV in our yard (within the Austin city limits).

I advertised with them and just moved a mom and adult son in this afternoon for top-of-market rent: in the middle of the winter!