In a Dutch repayment plan, the borrower pays a monthly interest only payment based on the loan amount that they agreed to borrow.

The plan is to hold the property for long term.

From my research, the only gray area would be whether or not the tenant continues to plan to reside there / has ended their residency or not?

What are you planning to build there?

My wife and I own a "second home" in Reno Nevada which we purchased with 10% down and were planning to purchase another one, but our lender told us that we can't get another loan for a second home within ~100 mile radius of an area where we already own a second home/primary residence.

But there is a glitch in your plan. 

Purchase price of $1.1mil, and I am planning to put in some work into it ($200 to 300k) since the house hasn't been renovated for over 30 years. 

I really like what I do for work and don't plan on getting out of that industry to go into REI full time.

This would allow you to eventually plan strategically to move into the new house and convert your current primary into an investment property... to then 1031 into your next project(s). 

The lease (with the current college students) was just renewed through their 2025 school year.I'm trying to figure out how to make this happen with little-to-no money down, as I have other 'irons in the fire' at the moment.I'm planning to offer $400-450k for the home, and am trying to structure something where a conventional lender would loan an amount that would be covered by the current rental rate (lets just say $300-350k)...   ...then, anything outside of that amount, would be carried by the Seller (for a short while)...   ...Seller financed with a ballon in 5-years?