Yes, fortunately, after conversing with the seller, I think we finally have the situation all worked out and set to close next week.

I probably shouldn't have jumped into this conversation to talk about my notes.  

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Of course, during these conversations, both the bank and I were focused on security of the monies in the account.  

So, to all of you who have done this, what was the conversation with the bank and the outcome?

That would put you at $7,200 to $9,600 to spend on this conversion.

I'm definitely leaning more towards the VA option, I just want to see if any of you have good reasons for or against either option.Ryan Conventional pricing is around mid 4's to higher 4's while VA pricing in the lower 4.00's but if you price the VA to be on "par," with conventional meaning the VA loan with no VAFF (VA funding fee 2.15 - 3.30%) then you'd have a similar rate to the conventional loan apples to apples pricing wise.The one advantage you had mentioned is that the scenario above wouldnt be  apples to apples when it comes to down payment because the VA loan would have 0% down while the conventional loan you could have as low as 3-5% down (with PMI paid monthly or within rate or split premium).Also, you only have VA entitlement (if not already tied up else where) for usually one property or home so by using conventional you can keep an ace in the back pocket or conversely you could do a low down conventional low with no monthly MI and keep the VA in the back pocket for emergencies or future planning (in case you plan to move out to get another primary shortly after 1 year again).VA loan also has a lot of YSP or yield spread premium so you can do no down and no closing cost pretty easily or use the credits towards paying off the VAFF or taxes/interest/insurance etc while the conventional loan does not nearly have as much YSP or lender credit to offer so your ability to strategically plan with your rate is not as readily available as VA.Generally, I'd say VA all the way 90% of the time but there are reasons to keep it available.

I realized it was not my passion - my night, weekends, and conversations with friends was always centered around 'real estate'.

And if I am understanding what Dorothy is saying, this is very different from rezoning a SFR in a neighborhood to have additional units.Appreciate the information and the informative conversation.

You have to use the lower of the adjusted basis or the FMV on the date of conversion.