I have also been looking into the benefits of an LLC vs. liability insurance.

Hi John - Welcome to Bigger Pockets  - you are in the right place to learn about real estate - there are many very well versed investors here who's experience  you can benefit from.

#1 - Your credit score.  

Looking to gain as much knowledge as possible about exactly how REI will benefit my family and peers.

So what one bank might do, another might do something totally different.My guess is that any drop in value would have to be fairly significant for a lender to reduce your credit limit, but I have yet to see a lender actually put a number on it. 

The lender I'm currently using (local credit union) will allow bank statements showing proof of income from the property.

I do not currently own any rental properties, and I have a single mortgage now for my own house.Anyone care to comment about my chances of these mortgages going through before I even waste my time at a bank and take a hit on my credit score for a mortgage inquiry?

I was having an informal conversation with a lender yesterday and he mentioned that house-hacking can provide the benefit of more favorable lending terms, but I didn't get the full details...I'm seeking insight as to whether purchasing a MFR as a personal residence (house hacking) can allow a smaller down payment (20%) or more favorable interest rates than if purchasing a MFR and renting out all units.

Could you get approved for a conventional commercial loan for a small apt property if you only had roughly 20k on your tax returns but have an excellent credit score, $0 debt, real estate owned free and clear, and cash reserves ?

Is having good credit important in investing or can you get by with ok credit?