Because it's a material fact to them.

I would have been ok with the latter numbers because I have been stockpiling materials for like two months, but...I did not know if I could trust them due to the lack of "professionalism," and my lack of experience. 

Current HELOC rates are typically 8-10% depending on your credit and lender, though some banks offer promotional rates.

And remember, authentic content that reflects your unique perspective and experience will always be more impactful than recycled material.

I'm going off the understanding that you still need to spend 500+ hours in the business to achieve material participation (please correct me if I'm wrong). 

A deposit at the start of a build is normal, this usually pays for materials and labor to get started.

all materials, all labor costs to others, Not you, utilities, interest payments, permits, licenses, auto/truck expenses, tools needed are all deductable. 

As others have stated, your fit & finish goals should be guided by whether you plan to:1) Rent: tenants don't always take care of a property, so you want to use lower-grade materials and workmanship.2) Flip: higher quality on workmanship and materials is usually required.Regardless, you always want to "Maintain to the Neighborhood".

I am 70% thru the materials and will likely go back and do a quick review of all materials before siting for the exam.

This is why a lot of syndications also fail - they raised a lot of money because the promoter was a great marketer but awful manager.2.