SBA does not lend directly they only lend through approved banks and for real estate purchases SBA requires the loan to be provided only where the building will be at least 51% occupied by the "business" getting the loan.  

Should my realtor provide me with a copy of the counties drain field inspection approval?

I have a feeling it may be the lender or the rep who doesn't seem to know the rules.CMHC will definitely approve a primary, even if you have 4 or 5 rentals.

If you do not have any experience in development and understand the approval processes, architecture, engineering and construction costs, forget this alternative. 

You definitely want to get pre-approved.

Do not rely on it for legal advice.

Have been working with city on whether I can legally add the finished basement as a unit. 

Hi @Randall Krongard,I just wrote a book called "Building Tiny Homes Legally In California."

After getting the contracts that are needed, do I have to send them to an attorney to see if they a legal?

But of course, all the other regular bidders realize this too.Also, make sure you get a search for mtgs/liens by legal description also, not just by the owner’s name search.