I love this idea, but would first talk with your ciry to determine the building regs.Have you done any comparison to see the cost difference than just building a typical multi-unit property with small units?

When bringing up subject-to as an option, the agent kept stating that his loan was un-assumable and that there was nothing more outside of traditional financing that could be done.

This has led to a diaspora to places like Webster, Northbridge, and Southbridge.Sure, there are new units in the pipeline, but they're unlikely to help the typical Worcester renter.

She has about 3 more months to go (could be more or less) before Plaintiff will be in a position to disburse/record.Is there a typical process on how these go?

It is very common for the typical bank mortgage person to make this mistake. 

Not an attorney - typically it is defined as moving into the property 60-90 days after closing and living there for a year. 

We use a flat fee listing agent to save on standard seller commission which allows us the option to offer a higher commission to the buyer's agent

Typically you want the B + R cost to be 75% or less of ARV.

I've been doing this for 20 years, and I still think buying existing properties is the best option.

The fines Ive typically seen my clients get are in the $10-$15k range.