That is correct. 

You defiantly want legal protection as stated by @Max Wilhite@Jonathan Bock is correct about keeping it simple. 

When we order the appraisal everything will come up so it will need to be listed correctly or else the 1007 will come in low.3.

@Jerry Chilimidos,Ned is correct, if you end up refinancing your rentals in the IRA - your IRA will be subject to UBIT tax on leveraged portion of the income so be sure to run the numbers with you CPA to understand the tax implications. 

Asking in the correct forum will get a better response.Read the RULES!

Perhaps a seasoned lender can step in and correct me if I am wrong! 

If I understand correctly; the seller would receive 80% ($40,000) directly from the mortgagee at closing and would enter into a personal agreement with me for the 20% down payment ($10,000) in which he would be reimbursed separately from my mortgage payments at a separately agreed upon rate and term?

., for their clients.Many will say, "that's the investor's problem".They are correct because an investor should NOT rely anyone else to run their numbers.So, then what exactly makes them investor-friendly?

In my view they made the correct decision and if you spent significant time recovering this cost, well I think we all know what that is. 

Further, "Downward Pressure" may be "bad" for investors, but it may also be "good" for renters - his policies, if I am correct, may negatively impact housing prices and rents, to the detriment of investors and to the benefit of renters, in the near-term.