I was told they paid on time, $650 a month, and were on government aid so the money flow was reliable.  

Trying to buy a house by using OPM.

All altruistic rhetoric aside.My understanding is there are a lot of people living in the area who wouldn't "Screen" in a very positive manner juxtaposed with a lot of people who also live there who would "Screen" in a very positive manner, and not a whole lot in between.The local government probably doesn't want the "Screen Failures" to move out of it's district and somewhere else where screening is less.Because these "Lower Screening" areas do exist. 

Someone made the same argument before the Supreme Court and lost in April....https://www.supremecourt.gov/d...My understanding is if the loan was sold to Fannie or Freddie, when they were taken in to receivership by the federal government the state’s super lien law no longer applied.

LLC's are governed by the State they are in (mine does), and protections are afforded by that State. 

If you are still working for the federal  government,  are under 59 1/2 , and contributing to the TSP this could be considered a withdrawal which would be taxable and incur early withdrawal penalties. 

There will be some digital marketing involved to bring traffic to a website designed to capture the leads.I know there are regulations governing marketing for investment opportunities, but this seems like a little bit of a grey area.

Just because the government will allow you to speculate with sharks because you have enough money doesn't mean the "accredited" investors have a clue what they are doing or getting into.Accredited Investors are some of the most sought after "fish" for a reason, and end up being the poster boys for the saying "a fool and his money are soon parted".The OP needs to learn to be a sophisticated investor, not just an accredited one. 

In almost all areas code violations are issued at the city government level.

Now if the house is for you, you can do a first time mortgage with as little as 5% down and take advantage of the new Canadian government incentive (assuming you qualify).