First, do no harm is officially out the window. 

That’s for said end buyer to put up, and that is when escrow will officially open. problem is we was never told that they was not  the “buyer”, except if a investor they new would be interested in the property signing the assignment is so they can allow that investor make the purchase.

FYI that you can advertise rooms for rent on the official military website - homes.mil.

Owner had kept contacting Bldg Official. 

@Griffin Sisk I learned the hard way investing with friends that to cover your bases be sure to make it official and have a formal partnership agreement with at least one or two well thought out exit strategies in the event something goes wrong or someone needs to exit the investment.

I spent hours last year trying to find if the MH is officially one or two bedroom, both for advertising it and for setting any limit on the number of occupants. 

I would assume so, but it's best to check with the lender to see how they interpret official FHA guidelines which read:"Net Self-Sufficiency Rental Income is calculated by using the Appraiser’s estimate of fair market rent from all units, including the unit the Borrower chooses for occupancy, and subtracting the greater of the Appraiser’s estimate for vacancies and maintenance, or 25 percent of the fair market rent."

The official term for Sec 8 is the Housing Choice Voucher Program because the tenant chooses where they live. 

This is theoretically risky business because I give money to the developer against a piece of paper in a foreign jurisdiction and I might never get anything in return, as the project isn't even officially launched.

Sometimes they (the lender) wont let you use the HELOC to (officially) purchase other property so make sure with your lender that's not an exclusion4.