Are you required down payment on investment property if get a great price?

[Ryan Swigart]

Situation- My grandpa  and I bought a property off market for a really solid price $125k cash. The plan was for me to remodel, get a tenant in it, manage it, and give him all the rental income until I get a loan to pay him off for the original $125k.

Financing- The ARV of the property is $190,000. With that being said I thought I would be able to get financing by either buying it from him directly for $125,000 without a down payment because of value of the home (70 LTV). OR get a quit claim deed and just get a loan for 125,000 or refinance.

My broker is saying that there are only two options for my situation:

1)Deed on title and wait 6 months then we do cash out refinance to pay him off?

2) Or buy it directly but it would be required that I put at 20% down payment

I thought if you got a property with that much equity you would not have to necessarily put money down? (which I can do but it isn't ideal) 

Are there any other ways you would try to finance this deal in my situation?

Thanks in advance!