FHA Loan for Duplex with illegal unit near Chicago

[Kathrina Briones]

Hey BP! Real estate rookie here posting for the first time! I have 2 questions for you:

1. I'm about to put in my very first offer on my first property! But I'm looking for insight on something that came up. The property is a duplex for $290k and the owner revealed that the rear 1bdrm as an illegal unit, so it's being classified as a 3bd/2bath single family. I don't want to deal with liabilities of an illegal unit so my idea is to just use as an Airbnb or STR. Also it's in an excellent location next to the highway and train line with lots of MFH (Forest Park) so I don't know why it couldn't be zoned multifamily.... Should I just try to appeal to the alderman or something? Should I just leave it as an ADU?

2. I'm using an FHA loan and my realtor said I need to remove the rear unit stove and cap the gas line to pass the inspection. Will this work? Anyone want to share their experiences with illegal units and FHA loans?

Thanks in advance for any insight, BP has been a fantastic resource!