I am in the process of purchasing my first duplex. 

I already purchased a home to flip with my brother. 

Purchase price: $350,000 Cash invested: $25,000 Second Property

My husband and I are looking to purchase our first home and we are very interested in finding a house we can live in for at least 3-5 years and gain a significant amount of equity.

As a person who has purchased hundreds of mortgage notes (non-performing and performing) and done many seller finance deals let me tell you if this was the case wouldn't all banks require the buyer (their borrower) to get such a deed so that if their borrowers do not pay then they don't have to go through foreclosure.  

What would be the best way to finance this deal as someone who has never purchased any real estate before?

@Devin Cutler I've had lenders tell me the funds cannot be used for things like "business purposes", "educational uses", and "new property purchases".

It depends on how much capital you have but I recommend either house hacking (3.5% - 5% down) a 2-4 unit property or you'll need 20-25% down for a non-owner occupant purchase which comes with higher rates.

I helped a young kid purchase a 4-unit he was going to house hack and manage, so I got him a nice Dewalt drill set. 

I am not sure if this is the right place or not but I wanted some input into any obvious issues with my lease option offers to the tenant buyer that earns plenty of income but doesn't have the cash right now and wants to improve credit before purchasing but would like to lock in the price as our market is still struggling with inventory.