I see many write that you can buy a multi-family, live in it for a year and purchase another multi-family.I can see going from a multi-unit house to single family house but can’t see taking advantage of the second tier entitlement from single to multi family, I know va loan officers and underwriters can be sticklers due to the va loan guidelines, so my question is to any former underwriters/loan officers, what are considered some legit reasons to take advantage of the second tier entitlement and what tangible evidence needs to be provided?

Make sure you have a solid understanding of the finances/math involved. 

If however; the land development deals are solid deals, they should sell.

Is there somewhere I can get a good template for a solid lease that I can modify without breaking the bank?

The warning signs were evident the moment they asked you what you had into it - which should have been COMPLETELY irrelevant, and I reckon you would have been best served by calling them out on that point, and so not told them your purchase AND rehab costs.

It's in a very good area of the city (Miami) and I'm confident it can generate a solid return based on the asking price, however there's just one catch (There always is!)

That run ended last december as I picked up 4 houses in 6 weeks - some really solid deals.This last year, I didn't hit on a thing though until a month ago.

Solid credit, solid financial, solid business plan.... mysterious blocks to underwriting.Private B2B loan underwriting is a cresting wave. 

Is there somewhere I can get a good template for a solid lease that I can modify without breaking the bank?

If you are holding for a rental, you can go higher as long as the cash flow and return numbers are still solid