How does the Homepath 10% work?

[Eric Bilderback]

I have almost no experience in single family rentals.  I have one small complex but would like to pick up some more property.  I pretty much blew my stash on the apartment, and it will take some time to save another 30% for a down payment for something substantial.  Which brings me to these Homepath properties.   I have looked at and do like a couple of them.  Please tell me if I have this right.  Here is one of the properties I am looking at.

It is going for 85k.  Heres the break down I think I can rent the place for 900.

-Payment at 77,500 loan is a little less then 450 at 5.5%.  I will use my real estate commission to cancel out closing costs for simplicity in my example.  

I am now looking at hitting the 50% rule. Is it true that there is no PMI for these Homeopath mortgages and also is a 5,5% rate realistic or are they generally higher. I also live in a very small town is this a loan product almost all banks do or is it difficult to find a lender that does these loans?

Thanks guys,

Eric