Worth.What about Freddie Mac or Fannie Mae backed loans?  

You can only have a max of 10 investment Freddie/fanny Mae investment property loans.  

So would it be possible to use a fannie mae homeready mortgage for my partner to occupy a SFH for 12 months and then just rent the property out afterwords?

Fannie Mae guidelines don't take into account if they're refinancing a loan from a hard money lender, or your Aunt Susie - provided there's in fact a loan against the property.

I'm trying to buy foreclosed property, owned by Fannie Mae, that was changed from "active" to "Temporarily off market" about 6 weeks ago.  

Fannie Mae allows 10 loans.

Is there a deed restriction where you can't re-sell the property similar to Fannie Mae or Freddie Mac REOs? 

It is at the bottom of a hill and according to a neighbor, the owner just didn't care anymore after his divorce  and let the water problems take over the house.According to your 123 blog J, I can only borrow 20% of my purchase price, since the purchase is hard money, to fix this house: see below  The Fannie Mae deed restriction also says that you can’t “encumber” the purchased property for more than 20% above the purchase price for 90 days either.

Fannie Mae allows up to 10 conventional mortgages.  

Im familiar with the Fannie Mae Home Ready loan, which is likely the 3% down loan you are looking at, but it requires PMI.