What can I do to get the lender to deny the financing, as my situation has changed significantly, and allow me to get out of the purchase contract without incurring legal action for default?

First off, congrats on getting out there and taking action!

In other words, I don't want to NOT take action now because I don't need to RIGHT NOW only to shoot myself in the foot LATER. 

Cash on Cash - ROI is King)Build Your Team (Contractors, Realtors, Lenders)Line Up Financing (Work backward what is the lender looking for to fund your deal)Raise Cash For Down Payments & ReservesCreate a Plan to Find DealsSchedule Your Time & Prioritize Next Actions (Take Action, Put it on paper and put a date on it, stick to the timeline, FYI watching videos or reading books is not taking action)Educate yourself (Know terminology and how to analyze a deal) 

This is not a financial crisis like 2008, we are forced into this situation by the pandemic, and the government actions.

I prefer owning SFRs and small multi-units over the larger multi-units for a few reasons:On larger deals you lose control due to the syndication.You can't sell to a retail buyer if rents compress (the value of the property is strictly based on the income it produces).A mortgage payment on a larger building is harder to float if something happens (flood, fire, etc.) whereas I can cover the mortgage on one of my single family houses if it floods, and the odds of all of them flooding are very small.Hope that helps!

Personally, I think for anyone wanting to get started or to add to their portfolio this year, it's better to take action now than to wait.

Better to have $100k producing $1k/month on 4 properties, each with 25% equity than from 1 paid-off property worth $100k.

I really appreciate your response here.To your part about "considering the rent" in as you would want to move out is the exact mindset I had.I too am having a hard time finding a Duplex in my area that produces a cash flow.

The email stated that the underwriter has assigned an action for me which read as follows: "The shed is in poor condition and needs the following repairs: rotten soffit and fascia, roof replaced and trees at the back cut down to prevent further damage."