I'm not a financial lender or whatever the legal term is. 

The way the guidelines are written is that you have to intend to occupy the property as your primary residence when obtaining the loan, and this is generally demonstrated when you live in the property for at least one year.

Legally speaking, the issue is not a material fact since it was remedied. 

Seems like the township did not deemed the property a legal for unit property.

If you need financial help, ask under the "Finance, Tax, and Legal" forum.

The tenants in the 3 bedroom rental aren't in a protected class but I do not want to get in any kind of legal bind. 

So if lots of parking, ideally walking distance to busses or transportation to cut down on cars, you might get away with it (legally).Operationally;  this is a can of worms to manage. 

I use the 1% rule to quickly assess if a property is likely to generate enough income to cover its costs and potentially provide a profit - it's a guideline - so, don't miss out on good investment property by being rigid when applying the "guideline" to rental properties.

If you need financial help, ask under the "Finance, Tax, and Legal" forum.

A "non-refundable deposit" is legally confusing.If they do request a showing, I send them this email:Hi John,Please read this entire email.How about a viewing on X at X pm?