Am I Making A Big Mistake?

[Carmen Almonte]

I have put an offer in for a multiunit at 88K under asking price of 600K. This includes me asking the bank to pay all closing at 6%. Bank said "no" holding firm to the sales price. I gave in to everything they asked, which included removing all contingencies except financing and agreeing to pay the full sales price of 600K. They said they were willing to pay transfer taxes (very small amount). The only thing I held firm to was I want the bank to pay all closing. The ARV is 750-800K. This place needs about 200K, which would be a high end rehab in this hot area. I am doing a 203(k) as I will live it for at least a year. Well, the bank just countered that they will pay 18K toward my closing and that they have multiple offers. The closing costs total around 31K on the prelim HUD1. So now, I feel like I may be being played...paying full asking. Also, I should add if I condo convert in a couple of years, I will more than make the money back. Heck, I would make a profit if I did it today albeit small. By renting it now, I may be short 400.00 a month or just break even. I can use money from a profitable rental that I have to cover the shortage. Any advice? The bank is waiting. And no, I am not a really experienced investor. This is my 2nd REO. Thanks!