Otherwise the Code Enforcement in Sammamish is a good place to call.But the first thing to realize is that Infrared technology requires new and different training and certification, and you have to make sure the Inspector was qualified to give you this sort of report.

If you cannot get a sufficient appraisal or qualify for the re-fi, you would be foreclosed on...the seller may ever insert that you would quit claim the property back...there are a lot of moving parts on this...

If the tenant buyer can't get qualified within 3 years, then get a new one with another non-refundable deposit. 

I've seen these types of business arrangements executed before whereby lawyers, therapists, barbers, CPA's, etc establish their businesses in "historical" districts (for lack of a better descriptive) and in some cases live in the same building or in the mother-in-law building out back.

I have a couple of questions now:1) If another qualified applicant shows up and is willing to move-in on April 1, am I allowed to reject the first applicant?

Maybe You can qualify for some first time buyers' credits.

@Sean AppleYour 1099 income may allow you to qualify for a Solo 401(k).  

I don't have any direct referrals in Buffalo however, make sure you choose and EA or CPA who is qualified.You definitely need someone qualified, does not have to be a CPA, could be an Enrolled Agent or an attorney.

If a really qualified tenant comes along, willing to make an exception with a larger security deposit. 

You would still have the two requirements of 1.purchasing at least as much as you sell (the net sale or roughly 700K) 2. use all of the proceeds in the next purchase (roughly 175K).If you keep that property as  a rental for no more than three years after living in it for two years you would be able to sell it and still qualify for the primary residence tax free exclusion even though it is a rental at the time of sale.