Consumers are frequently surprised that Fannie Mae and other financial institutions are lacking in common sense.
Here is my answer to your "how can?": Fannie Mae and other financial institutions do not possess common sense. If you want to deal with them, you have to expect that.
The listing (or selling) and buyers agents know that that your insistence on using common sense will likely lead to the result of a Fannie Mae clerk or software program rejecting your otherwise fine offer. It is a Dilemma that the seller requires buyers to state something ridiculous to get their offer even looked at.
Stupid Fannie Mae.
Agents would prefer that Fannie Mae not be so dumb, but we also know that jousting at windmillls does not get the job done.
I'm not aware of any agency lenders that will lend on vacant land, you'd need to go through a portfolio lender and you'd be looking at roughly a 50% down payment....
Or you'd be looking at a regular construction loan, which are also rare, and would require roughly 25% down....
Conventional financing is reserved for completed homes with the expection of inhabiting the home typically within 60 days of purchasing (primary residence)...
Or maybe you're doing all cash?
Please confirm this, and best of luck to you!
The Owner occupied condition plays for the first couple of weeks and then the home can be opened to the investor market.
I would suggest you have your buyer's agent contact the listing agent to resolve with the asset manager.
Once they see an appraisal with vacant land and a nonhabital (assuming) garage, you will not be able to utilize conventional financing.
Somewhere there is a communication disconnect.