If the buyer has a normal home in the surrounding areas, you'll have a hard time getting any lender to approve. Often, portfolio lenders are tighter.
Fannie Mae has a loan program called My Community which allows a 2-4 unit purchase with 5% down. This may be a good alternative but you'll have to do some convincing to the underwriter as to why they'll occupy.
In addition to Washington Federal, US Bank and Union Bank are also portfolio lenders. You can use some of the contacts given below or email me if you want another referral.