Some require a subscription (could be landlord or tenant paid). 

Traditionally banks loan on appraised or purchase, whichever is lower...you may be describing a hard money lender...that's a different ballgame altogether...It's impossible (in 99.999%) of all real estate acquisitions to use financing and acquire a property with no money out of pocket...best you could do is HML if you're flipping this...you may scrape by with points and fees...If you're using HML you will have to sell the property or settle the debt with a re-finance...re-fi's are typically 70% LTV...and completely dependent upon your personal financial situation, DTI...easy to get burned if you don't have capacity or the value is not there...and this is an expensive asset.A conventional lender can't lend if seller financing is involved...lending constraints...

Maybe I could understand if they wanted me to pay a single license fee to rent multiple properties in their city but $250 for EACH property?

Very rare the cost to build, including land, engineering, utilities, impact fees, etc. is less than the cost to buy an existing duplex.....in a comparable neighborhood anyway.

It sounds like they are limiting their liability to their fee proposal and nothing else.

I figure this was a good idea since it would be a direct buy with no brokerage fees.

We recently took out HELOC on our primary residence with 3.99 fixed rate, 3 years draw period and 10 years Amortization. 0 closing costs, not appraisal fee.

I would also add on that you should ask them what deals they have closed in the past and ask them for some details on those deals so that you can see what numbers they work with, their level of detail, and if their deals make sense to you, because as you will see in this industry there are a lot of people who think they can make a quick buck and have absolutely no idea about finding a reasonable ARV, repair estimates ballpark, and/or calculate closing/holding/financing fees that buyers will incur.Also, make sure that they actually have the original contract to the house if they're assigning it to you because some people try to wholesale other wholesalers' deals and it's a mess.

My process is I need applications filled out for everyone 18 or older who's going to be living in the unit, and I need the application fees in cash. 

The only way I could figure out monthly payments through the website was with PayPal which neither offers ACH nor the client paying the processing fee.