The margins in the ARV don't excite me to be worth the time suck.

Sorry to break the news to them, but PM is a LOW LOW margin business.

The issue I have been running into is everything on the market is being pursued so aggressively that everything I have looked at getting and is a decent deal, ends up getting bid up past what they are even asking to the point there is hardly any margin to work with.

The market is shifting and the margins are shrinking. 10 years of stratospheric economic rise has given the market LOTS of competition and rising interest rates are having a real effect on deals.

If the margin is small, a couple of thousand dollars, then just take the risk.

But it is a cheaper way than a refi and lets you unlock all the appreciation without having to think about leverage margins.  

You're probably more likely to lose money on the 2% rule than the 1% given the fact that it's going to push you into marginal areas in today's market.

The margin remains stable over the life of the loan.

The reason being there is not really a "margin of safety" of only $40,000.   

They only conclusion I can draw from their behavior in these matters is that they want to keep me in the fold and would rather sacrifice a little margin an a deal today, to keep our relationship strong (which one could conclude is better for their long term business and hopefully my long term wealth).A few examples:One house we had under contract, I got a 3rd party inspection that came back bad.