However, you have a legitimate claim for 1/2 of the deposit since that is your actual losses.

This made sense to us because it would enable us to live mortgage free and save more money to invest in more properties.

It is possible I work both sides under asset management and acquisitions which will only enable me more.

If you can legitimately get $400/month with only leaving $5k in the deal, that is solid.

Legitimate lenders will not ask for up-front money.

I just wasn't sure if an extra bed (without a legitimate room) would actually increase what I could make in the short term rental sphere. 

By doing this, it enables you to keep your total cash to close and monthly payment about the same, however it strengthens your offer much more. 

@Thiago Oliveira - have you seen any legitimate private lenders offering rates that low?

If they don't have one, chances are they aren't legitimate, even with a website.FHA is not the smart way to go either if you have 5% to put down. 

@Caleb Brown So here's a rundown of the basics of how the VA home loan works...When you go to get a conventional mortgage, typically lenders want you to put 20% down which will enable you to avoid private mortgage insurance (PMI) which protects the lender in case you default.