This loan type does have a lot of red tape, but if you approach it methodically and get organized before making an offer, it's quite powerful for house hacking.

- any other major red flags that I see with the tenants and the property inhabitants in generalAll of those should be pretty easy to see even if you do not have much experience and your agent may even be able to fill in the gaps for you.

BE BOLD

The first big red flag I see here is your expenses.

So things that are a red flag for me may be fine for someone more aggressive.

Saying you pulled it out to buy a property and were effected would set off some red flags.

This does two things: 1) Triggers your mortgage company to procure very expensive lender-placed coverage on the property, and 2) Raises a red flag about the title transfer. 

Rehab loans have a lot of red tape around them, so unless you are doing major renovations it's probably not worth messing with that. 

The problem I am running into is that the co-signer will not also be occupying, which was a red flag for this lender. 

@Carrie Mims Could be a potential red flag that no permits were pulled or the municipality does not consider that area of the home to be "livable square footage".