There did seem like there was a ton of potential in the walk-out basement as I could see an extra bed/bath being converted to it.Ultimately I would just like get him out of this mess. 

I have a few investment properties under my belt (converting primary residences into rentals), but am now looking into scaling up and doing my first partnership on a buy and hold condo, and looking for some advice on how to the structure the deal, especially from an equity/profit share perspective.  

DIY might convert your personal effort into some saved money in the short term, but you expose yourself to a pretty hefty, and expensive, learning curve should you mess something up.A couple articles I might recommend: questions to ask an attorney and risks of DIY LLCs.This isn't legal advice, just my opinion as a real estate investor.

The Tanglewilde-Thompson Place neighborhoods in Lacey are probably the best right now for finding (or converting into) a multifamily home.

However, if they do everything required of them, the holding fee converts to their security deposit and they get to move in.

@Wayne BrooksThanks Wayne it gives pretty good insight, it was a single family home but the previous people converted it into 2 family home because it was quite big could have easily be converted into 2 family legally but somehow they did not chose to and we bought it on auction, county court auction.

I look for properties that I can easily house hack by being able to convert the existing spaces (spare family/living room and garage) to an ADU and then rental it out. 

I'm split between "converting" into 2 retail spaces, or an office building.Option 1: Divide the building into 2 retail storefronts, one approximately 1,500 sqft, and other 1,200 sqft.

With a strategy like yours, it would be very advantageous to own a casa do pueblo, which would allow you to build-out additional bedrooms, bathrooms, create horizontal divisions, maybe even convert a local into... another apartment, etc.

To answer the question it appears you are asking, yes you can convert/refinance a VA loan guarantee to conventional financing.