I am not sure about yours so I would recommend investigating that further.The legality of it aside you are not going to have any luck finding agents who would be willing to work with you.

Some people are telling me to just buy with 5% down as owner occupant and just rent out the units anyways, since is my first property the bank wont investigate as long as payments are made on time.

Even if you have a perfectly legitimate reason (bad payment history, property being sold, owner letting a child live there, etc.) you still have to deal with the complaint process and investigation, and the possibility of other charges being made against you if other things come to light.

There just isn't any "big money" investigating the returns for real estate investments in Pueblo that would push the returns down to the risk/return efficient frontier.  

I thought about investigating the "Creative Village" area when I was close by, but didn't.

Might be worth investigating that.Those two items will likely get you back in the black soon enough, you just might have to eat the loss for a year or so.Also, we all make mistakes, sometimes big ones.  

They are currently investigating why this is the case.I guess i don't really have a question, just wanted to see if anyone had any insight.Thanks!

Are you still investigating the building?

I will start investigating starting an LLC, it will be in TX, I heard they are pretty business/landlord friendly.

Do the walkthrus with your "free" quoters, once you get the bids and you've investigated and have made a final decision, don't sign any contract before materials are listed, how long before job completion and include in their contract NOTHING is DONE without discussion with you and you get a change order or any changes!