My wife and I live in a MFR that we own. once our upstairs rental income is qualified (2 years) we will be able to utilize a percentage of it as income for lending.

As I’m going through the process of purchasing a multi +5 units under an LLC and obtaining a mortgage, according to lender building qualifies for mortgage not myself and a personal guarantee would be needed.

@Neil Haven a four unit property will qualify for many commercial programs, which may be the way to go.With a commercial policy, you may have more flexibility with choosing the building limit and can pick and choose which coverage's you want.I would suggest calling a local Independent agent. 

I need to start looking at properties that will qualify for the lower rates...it doesn't make sense to invest directly otherwise.

Using the income from the other three will also allow you to qualify to a better quality of property.

(I'm only willing to do that because we are here and relatively skilled and are willing to do work ourselves). 

A couple can elect to be treated as a Qualified joint venture.

I talked to a FHA lender who said if you are vacating a property to buy a new one using FHA, the vacating property must be over 100 miles away or have 30% equity in it in order to use rental income to qualify.

I talked to a FHA lender who said if you are vacating a property to buy a new one using FHA, the vacating property must be over 100 miles away or have 30% equity in it in order to use rental income to qualify.

There is a new 20% pass through deduction you may qualify for that could help you, but not everyone qualifies.