My mortgage broker is the **** when it comes to VA loans and funky investor stuff. 

HVAC is 5yrs old Plumbing is good unsure of the age.Purchase 88k Loan FHA 3.5% down bed/bath 2/1 each sideSide 1 is currently rented for $440 (below market) by $45 for the sizeSide 2 I will be living in with a roommate and room rent is $330 (median market for a room for the size)Side 2 COMPLETELY RENTED will be $675 (median for market)Owner pays near $180 for water a month and tenants pay the rest of the utilitieswith mortgage, insurance, taxes, fees, monthly payment to own the property is $611.87I am really just trying to cover all of my bases right now. 

It either has to come from your own resources or be gifted to you.I suspect it works similarly in your area.That said, there will be folks who will tell you ways to circumvent this requirement ... and it happens routinely, but in the end the lender could pull the plug on you if discovered ... or worse, the words mortgage fraud can come into play as you will likely attest that the downpayment comes from your own resources.

I'm sitting on about $6K total after saving for quite some time, and I want to know who has had any experience pairing an FHA203(k) with one of the 1% down payment mortgage products available through FreeandClear Mortgage, Guide Mortgage, or MLS Mortgage?  

Owner said has long term tenant on one side of 9 years , building has had  great rental history.  600*2=1200 monthly1200*12= 14400 yearly taxes/insurance =2800 yearlyrepairs/maintenance 10%= 1440vacancy 10%=1440 14400-2800-1440-1440=8720 NOI20% down on 99000 @ 4% interest 30 years =19980 mortgage payment roughly 382 a month /382*12= 4584(NOI )8720 - (debt service )4584= 4136 monthly cash flowcash flow 4136 / (money invested) 19980 =20% ROIAm i missing anything here ?

My thinking is that I can put very little money down on this deal while at the same time having a cheaper mortgage compared to if I just go out and buy a $60,000 house.

And I'm not talking about a HELOC on top of a regular mortgage, but a HELOC instead of a mortgage. 

We have no mortgage on the building, as we flipped a large waterfront home for the funds.

Also, you need to find a mortgage person that understands what you are doing and is investor friendly.

But on a preforeclosure whole sale, who takes care of the existing mortgage loan?