Does this approach seem reasonable, or am I undervaluing the property?

To get access to the maximum amount of equity, I would recommend Tower Credit Union.

Large deposits are nice, but very difficult to actually get access to escrow funds in the event of default.

This could be an opportunity to share what you've learned.

Proximity to Major Northeastern CitiesBuffalo’s location near major urban centers like New York City and Boston makes it an attractive alternative for buyers seeking more affordable housing without sacrificing access to urban amenities.5.

Start with BiggerPockets Ultimate Beginners Guide (free).

This will help you make informed decisions when it comes to buying. 

You have a lot of resources at BP and in this feed. 

I would encourage you to read this beginners guide from BiggerPockets, it's a good bit of information so pick and choose what you want to read or read it all.

@Rene Hosman You can read about H.S.A. investing in my new BP book - Self-Directed IRA Investing: A BiggerPockets Guide - www.BiggerPockets.com/SDIRA