I do specialize in all of middle TN so let me know if you would like to connect and we could get a little more in depth. 

I've found that accurate assessment with sufficient third party support can often help parties find middle ground. 

Lynchburg and Staunton are in the middle of nowhere, what makes you put them on your list?

It would be worth exploring all options, and if you are willing to live in a duplex or one of those options, the rate for owner occupied financing isn't 8%, it is closer to 7%.Also, since the market is softer, you could easily ask for a seller credit to buy down the rate closer to the low 6s, and meet somewhere in the middle with a similar mortgage payment as a new build and get something that would be a really good house hack for a family with privacy, garage, etc and get the benefit of renting the other side or ADU.

And the middle man well they usually have their dough and no personal liablity and could give two craps if it works or not.. thats reality on many of these and how its going to play out.This all works for the very well capitalized company that can handle these things.. and I am not sure in Texas if on the wrap you use an all inclusive Deed of Trust like I used in CA.. thats a great deed of trust it does give the wrap seller standing to start a foreclosure on their own while still making the payments.. it also precludes the slimy sub to buyer that may just take the wrap buyers payments and default to their seller I have seen this happen many many times and bailed out more than 10 of these.  

The plan is to rent out the top unit to a long term tenant and for us to live in the middle unit until we move out (if we ever do). 

In cities where zoning is residential, there's more flexibility, especially in places like Oregon where legislation was passed a couple years ago to allow "middle housing" in all residential zones regardless of primary zoning.

I have that awkward middle bedroom in a Philadelphia townhome I don't know what to do with. 

For a flip you'll want middle to higher end.

Also, as tempting as it may be, don't stop in the middle of a job.