They do fund 100% of the rehab, but they won't allow you to draw until you can prove the work is done, so if you need to pay for materials for your contractor to get started, that will be out of your pocket.

Reaching out to the more experienced BP brain trust for ideas on the down payment or other options and alternatives. 

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From your experiences, what are some creative alternatives I can use to get this deal done?

@Joe Villeneuve what would you recommend alternatively?

What is the difference between REPS hours and material participation hours?

If it's a material amount I don't see a bank closing the loan until it's taken care of. 

If you did the work yourself, you saved labor but you still purchased the materials so your basis for the depreciation should be assisted by that portion.

I typically deliver all materials to the job site and I am still doing some of the work at the end of project like cleaning floors and windows, installing appliances, odds and ends stuff.

Returns If you are getting a 0 on returns in an appreciating market and get a great Location and an asset on great condition you may be fine or even better off.Considering labor costs and material cost if you buy a turn key property you may even be ahead of the game.