@Susie Oanh NguyenWell, its sort of depends on what State you are in since licensure is regulated by State. 

@Darrick Lowe Your mortgage holder probably has no desire to let you change the entity structure of your loan, and it is likely they can't due to various rules and regulations they follow as it was underwritten as a primary home loan.

@James Allen If they're good tenants, pay on time, and generally take care of the homes, I don't see an issue with having them stay as long as they follow the rules and regulations.

Very interesting... https://www.forbes.com/sites/chuckdevore/2019/06/27/workers-moving-from-san-francisco-to-austin-would-get-an-immediate-46-raise-due-to-less-regulation/#7ef0fb0f2d81

Step one - buy propertyStep two - furnish property and determine if you have any special local regulations you'll need to abide byStep three - go on Airbnb and select "create new listing", follow prompts, and launch

https://www.hud.gov/sites/documents/FHEO_BOOKLET_ENG.PDFTypically owner occupants are excluded from fair housing regulations as long as they actually occupy a unit and there are less than 4 total units on the property. 

I was thinking of turning it into a 6 or 7 bed house and renting out each room to college kids...Any restrictions or laws or regulations in the state of Washington that would prohibit me from doing so?

Federal Regulators including the Federal Reserve and the FDIC look at a sampling of each bank's loan portfolio and they apply a "grade" to each loan to come up with a quality of the bank's loan portfolio.

Check your local regulations. 

Learn what the local regulations are so you know you can adhere to them.