There are a few foreclosures I've been eyeing, however, very clearly states that buyer is responsible for any certifications, including Use & Occupancy, Certificate of Occupancy's, permits etc or anything else.   

Simple way and the best loan terms would probably be for Tom to do a standard FHA owner/occupant mortgage. 

. $50-60k houses with the occupant agreeing to maintain the property and buy over 15-20 years.

@Carl Gryska , lots of questions but the answer to most of them is that the deal is completely flexible and can be just about anything a willing lender and borrower agree to with the caveats that there are some State specific usery laws and that, because of Dodd-Frank, the borrower is not an owner/occupant.  

I am not rehabbing anything for multifamily right now.I do know some REITS and other groups who do it.You have to know what exit cap you can get selling the apartment building or what kind of equity you can pull out with a refi.Typical deal I am seeing is stabilize to 85% occupancy or better and then after 12 to 18 months a bank will let you refi 75%ltv of the new appraised value.Say you bought 50 doors at 3,000 apiece for 150,000 cash.

Our lease states the apartment/house must be left in the state it was orginally in when they took occupancy.

Dan, I'd be happy to talk to you about my occupation, but it's pretty boring and not much going on right now.

The listings I've seen have listed about 80%+ occupancy.

We are seeing only that high of a return if the property is purchased with cash and some high occupancy rates are assumed (80%+).

I don't suggest letting occupants do repairs, because you will end up with flawed work, which by the way, where did that come into the formula?