What are the complications and consequences of not living in an owner occupied multifamily property for 1 year but telling the bank that you will be living there for 1 year?

Here is one that is currently going around in my town of Waterloo, IA that i think could be a big deal for landlords:The Community Development Waterloo, Iowa Lead Hazard Control Grant completes improvements to your home to remove lead based paint up to $40,000.Both owner-occupied and rental homes can participate.Your home must have been built before 1978You must be income eligible & have children under the age of 6 who reside or visit frequently.This money can be used to replace windows, doors, or siding with lead-based paint.

With this loan you can buy a multifamily, under 4 units for possibly no money down as long as you occupy one unit.  

I opened it right before we moved out (had to still be occupying in order to set it up) and I should have done a higher amount.

Occupancy: Will be owner occupied until fully renovated and ready for short-term rental market.Value of property at present and/or your offer price: Last tax assessment was $117K - seller is adding a metal roof and offering for $115K.   

You as an owner intending to occupy can evict under current statute. 

While some are being purchased by large investors, many others are being purchased by owner-occupies, thus taking a rental unit off the market for each of those occurrences.

We' re looking to exercise the option and get financing at 75% LTV fully owner occupied so we can purchase the building and put some cash in reserves. 

It needs a major rehab to get all 6 units ready to be occupied. 

It is tenant-occupied at $500/month.