@Matty P.In general, yes, closing costs are higher than a regular FHA loan.You still have to pay MIP upfront and monthly like a regular FHA loan.However, with a 203K you will be charged supplemental origination fees.

I think I want to persue a buy/hold approach - mainly because I want to build a retirement equity portfolio (preferably leave my 401k and transfer funds to IRA for investing) via real estate, and to have the cashflow from these rentals as a good supplement to the income I have now.I hope in the future, if things work well, to be able to persue real estate full time like the pros :)

Is it your present business plan to supplement tenants rates based on whether you like them or not.

I was looking for additional capital to supplement my private lenders.  

I'm a teacher and will need to be supplementing my income big time in Montana.

Once you start supplementing income with rental income your tax returns get messy for some lenders and they dont want to spend the time needed to make a deal work. 

You first have to do reverse engineer to figure out your future income when you retire and figure out the gap or supplement needed...

@Lillis Hawker, Given your situation of needing rental income to supplement a lower than desired salary, but also needing to obtain a place to live in your new location I think @Mark H.

Supplementing a tenant rent is illogical.

Those same colleagues worked past 65, many taking on menial jobs to supplement retirement.Then there was the bat house.