Eric, The lenders are correct that if you are an occupying resident that you will get the lower rate, however lying regarding your intent to occupy is mortgage fraud. 

My first few offers fell through and I finally landed one that's in contract.I'm nervous as hell so I thought I'd share the details with you guys and see if I can get some reassurance or at least some advice.It's a 4 unit property for $150,000, fully occupied.

Currently tenant occupied. 

Rule of thumb is don't work with a big bank since they don't really do OOS non owner occupied loans.

The single family home in front is usually occupied by young professional couples or a couple of roommates who all qualify for the rental terms (i.e.- three times the rent for each individual, not collectively).

cash flow is OK .. 100% occupied but tons of deferred maintenance and renovations needed. in and out.  

Perhaps if you buy a multi with a smaller and a bigger unit mix, you can first occupy the small unit, then move to the bigger unit if you need more space, then ultimately move outward and upward when the time is right.

I don't think these types of strategies would work all that great on occupied commercial buildings, but the one that I'm starting to dig into has been vacant for several years from what I can tell.

It is not only for avoiding people physically damage your property or occupy it.

Search on Airbnb and see what other properties are renting for off of the beach and how many nights they are occupied (look at their calendar availability) to help run your own numbers and make sure they work.