That seems weird to me and would raise red flags for auditors and I want to persue this in the best knowledgeable way possible.  

This is a huge red flag. 

If a buyer is coming down with a high-down payment and quickly making a large deposit into escrow fighting tooth and nail about proof of funds may be a red herring.Credibility is also a factor here.

I would also ask all contractors about how their draw process works (red flag is: 1/3 up front, 1/3 at half way, and 1/3 at completion.  

Quote from @Jay Redding: Steve - We would be interested in taking a closer look at this. 

Check out Red Stick REIA, Westbank Real Estate Investors, Northshore REIA and NOREIA.

Right now we're in the red, which we figured.

They buy at deep discounts and have economies of Scale to be able to wait out the time when Homes Prices and Rent Prices must rise eventually.It's a lose-lose for Mom and Pop but a Win-Win for Big Money Landlords.It's the complete opposite of what the Liberal's intentions wanted and they will fall into self-delusion that it's a Conspiracy of the Rich.

CredibilityIf you have these 3 ingredients, you WILL get a conversion—guaranteed.Without getting too deep into this… “personality” is the biggest one.

There are limitations such as you need to find deals that are 75% of the ARV all in cost once completed, nonetheless that is very feasible with deep value add deals.