You would need a decent cash flow to be able to 1) pay for principal & interest, 2) money for rehab. 

Probably not the return shareholders are hoping for, since that's only about a $3/share return, which is a pretty paltry 15% over a 10-year holding period, based on current stock price of about $20/share--so if there was no operating income, this wouldn't be a great stock investment.There is definitely some risk baked into their model, which is why they have to pay bondholders a better rate of return than they would get investing in a Treasury Note where your principal is guaranteed by the US Government, or putting the money into CDs where it is guaranteed by FDIC.

Totally legal to rebate to a principal to the transaction. 

The interest alone on $100k is $25k (with no principal pay down).  

@Chris Seveney  that's interesting.. lets say you buy a rental for 100k with minimum down  20k.you make 150 a month cash flow ( realistic numbers unless you value add or get some smokin deal)something happens and you need to sell in 5 yearsyou bought for sake of argument in a non appreciating market as many on this site admit they are fine with.. now you go to sell.. 60 X 150 a month = 9k   you have 10k in sales costs.. figure 6% plus closing cost plus seller credits and honey dews on the house plus it makes the math easy.so you net 90k  add in your 9k positive cash flow your at 99k... so just about break even but now your had to recapture 15k of deprecation and pay tax on that lets say 5k for easy math.. so now over a 5 year hold your 150 a month Coc really has a negative IRR since you lost right at 6K of actual cash and your only gain is whatever little principal pay down you got on your longer term note.Do you think I have that right.. only reason I bring this up is I sold a bunch of my rentals and that recapture hit me hard personally.. but I just wanted to reposition to notes as I am not a very good landlord..I think this is why if you think my numbers are correct.. that folks need to accelerate pay down so that you can pay these off quick so if U do need to sell and most people sell every 7 years stuff happens they have some true equity. or at least some cash coming out of the deals.

Juat be aware that your e&o insurance will likely not cover you for transactions to which you are a principal.

As others have said, 25% down, closing costs and depending on the bank, they may require 3, 6, 9 or 12 months worth of principal and interest in liquid funds.

Always act as a principal.

If we agreed to say 100K down @ 5% for 30 years and paid 40K in interest per year and 15K of principal.

Ideally I would like to use the profit to pay off some of my principal on current primary residence mortgage and use the rest for investing in a townhome that I can rent out...Thank you for your inputs!