I've had good deals and bad deals and have learned alot in between on how to work through problems and help my clients find solutions.

I'm not sure how that would work.Does anyone know of a solution for this motivated seller?

I was having an informal conversation with a lender yesterday and he mentioned that house-hacking can provide the benefit of more favorable lending terms, but I didn't get the full details...I'm seeking insight as to whether purchasing a MFR as a personal residence (house hacking) can allow a smaller down payment (20%) or more favorable interest rates than if purchasing a MFR and renting out all units.

I reside in California and focus on multi family projects for my investors out of state.

I know there is the 'due on sale' clause that could be a possible threat here so what is the solution?

@Prashanth Prash, I can't speak to what others are doing, but I just closed one where the borrower's entire $70k down payment, closing costs, and PITI reserves, on an investment property purchase, consisted of borrowed money secured by her primary residence as a private 2nd mortgage.

We can add a few extra brains to figuring out a solution, but waiting to call us adds time pressure that's not helpful.  

I first jumped into the market by purchasing my primary residence in 2012 (which I recently sold for a profit in May 2016).  

However, owners who evict for these family members to move in must already live in the building or be moving into the building at the same time as the relative.The owner or relative should move into the unit within three months and intend to occupy the unit as that person's principal residence for at least 36 continuous months.

My wife and I have bought and sold several houses over the years, but those were our primary residences.