Would you considering occupying the townhome? 

For example, a prospective tenant who occupies 20% of a shopping center has lease language stating that they will reimburse for all expenses, excluding property management.

I also noticed it said it needs to be owner occupied I was curious if this was something you could jailbreak for a year during the rehab phase and then convert into a rental?

3) 10% for a commercial building is hard to get, but since he will be owner-occupied, he may be able to get traditional financing at 70-75% and get another 10-20% from the IDA or SBA. 

Understand as well, that if his friend is in the business, it’s very difficult for him to make an owner occupied, consumer purpose loan without proper licensing, an NMLS registration, compliance to TILA and RESPA, and on and on.

Nithin,If you are talking about renting just a portion of the house and living there your current homeowners policy may need to be endorsed (depends on the company - check with your agent)If you will no longer be occupying the house when you rent it out, it is likely that you will need to change from the current homeowners policy.  

These loans are for the borrower that intends to occupy for 1 year. 

I have a primary residence, but am looking to see if it is possible to purchase a triplex as an owner occupied residence with a lower down payment than the 20% required for typical loan.  

I was in the process of putting letters together to send to a bunch of non-owner occupied homes in the area I want to get started in.

As for an owner occupied primary, I'm also going to put this out there that there are 'no income' programs out there, but there's few lenders who offer so you'd need to find a mortgage broker who's hooked with those specific lenders to help you there.