An identical home sold in the last 3 months in the area for $244,000.

If you're looking for good local contractors, I'm going to steal a quote from one of the BP podcasts.  

Cooking meth in the back of the property, stealing his mother's disability checks, etc.

Well if that small loan is in a bad area that can't sell, and big loan is in a great area, and the buyer got it at a steal, then it's not the case.You won't get many lending offers on low cost deals except for one company down in Philly, who doesn't mind taking over your property...

It is possible that I’m just overlooking the obvious.So this deal is for 2 4-plex apartment buildings that aren’t connected, however they are identical and share a small parking lot.

@Cody Evans  As an agent you will need to begin building your identity as a trusted advisor in home sales and purchases. 

I told him about the REI meetings they have in our area where local RE investors support each other, give advice, network, etc. to basically say "tons of people are doing this," and his first conclusion was that it must be some "investing club" that's trying to steal my money and convince me to buy real estate from them so I take on the risk and they try to get in on the management side to take a cut.

“We are stealing the future, Selling it in the present, and calling it GDP.”

I am sure everyone on BP is a saint but someone may steal the deals from right under your nose.I also think you are underestimating the closing costs.

Aloha @Zasha SmithYour folks situation sounds identical to ours.