Both the legal and tax sides need to be considered.Are you going to charge arms-length management fees from LLC B to LLC A? 

The idea was, I create a lead generation funnel by becoming known in my community for closing on deals, then pay the person who sent the lead out of my profit.This got me thinking, is this legal?

Is this within legal guidelines?

(Like the property has to few tenants for a bank to give you a loan on the property or the seller is motivated to sell and will be willing to let you assume the loan (depending approval from the bank of course.)

I'm aware that people privately lend to other people and investors all the time, but I'm asking more in the context of the legality of making an effort to seek out investors and loan to them. 

She either qualifies or she doesn't, you offer her housing if she does, and move on to the next applicant is she declines or is not qualified.Commute times and other ancillary details like that are not really your concern (though commuters are not a protected class, so I suppose you could legally make commute time a screening requirement if you were so inclined). 

Ive been pre approved for an FHA loan, but still wouldnt be able to work in this case since I would need to live in the property for at least a year.How would you go about buying this property?

(It's a legal and copyright protection thing.)If you go to the Events Page (www.biggerpockets.com/events) you should get a list of meetups that are near you.

@Mike McKeown It is not FHA approved so that's why Im trying to find an alternative, any suggestions?

You legally don’t have a foot to stand on