From what I have seen, it is rare that banks deal with income property and know how to calculate the numbers for it.

If she went to Assisted Living - I can help you but it's only KS Specific - each state is different but I'm guessing some of the guidelines carry across states in regards to how she will pay for the ALF and eligibility for Medicaid and Home and Community Based Services (which is a medicaid program that would help pay for ALF)Anyways in KS - in for someone to qualify for HCBS/Medicaid to help pay for their care either in the  home or assisted living - you need to have less than $2k in assets - and consistently less than $2k in the bank - there is also something called a 5 year lookback period - I do not 100% understand how the lookback period works but will soon enough.So - as far as the assets are concerned - if your friends mother has the house and any savings there is no way the govt will be paying for most of her stay in ALF - and I also think it would be difficult to house her in an ALF facility for $3k per month - can be done but tough - Due to no estate planning the family needs to decide on what they are going to do - they will either need to sell the house now and just pay her money down at the private pay rate in a facility until she "runs out of money" then apply for Medicaid and go from there or see if the strategy of renting the house with her present income will be enough to cover the facility she's staying at.Individually the systems are simple however there are so many moving parts to Medicaid HCBS I've discovered in my time as owner of a facility I can 100% understand the families frustrations. 

I'm a retired Navy Officer and Iraq Vet looking for advice on which local CNY banks are the most motivated to work with somewhat blemished financial backgrounds. 

I may be able to get her on bank draft or some other method. 

There is a lot more risk for them and their asset portfolio than there is with a large bank considered in some instances "too big to fail." 

The traditional mortgage broker we are using wanted to use my personal banking and debt-income and needs the down payment to come from me.

Try and set a goal for when you would like to pull the trigger.3) At your age check into the first time home buyer incentive the banks offer.

If the bank approves, does that mean that the Buyer can assume our $2.45 million loan at the same rate??

It's much easier to influence an appraiser who only has to answer to you (the person paying him) rather than justify the value to a bank.

He will pay it back plus the interest the bank is charging the parents.