What is the difference between a mother-daughter home and a legal two-family?

A mother-daughter home typically has a second living space, often with its own kitchen and entrance, built for a family member rather than as a rental unit, and it may or may not be permitted as a separate legal dwelling. A legal two-family has been permitted by the local building department as two distinct units, which is what allows a lender to credit rental income and what protects you from code violations. The physical layout can look identical; the permit history is what actually differs. Joel Boss checks permit records before treating any second unit as legal.