If this is the whole story, I don't think it's that bad, and I am tempted to rent to them, but I don't know what else.

You should always ask if you don't understand something, it can easily keep you from making a bad deal.By 'automatic equity at purchase' I mean you should be able to get the property for 5k-15k  below market, thus 'earning' automatic equity.

These guys have pretty much summed up house hacking.

Many of the guys I know in the business have gone and got their real estate license and are making more money doing traditional real estate deals. 

Thanks for the welcome guys!

I am not a no money down kind of guy.

@Rick Baggenstoss  I grew up in Glenn Garry glen ross my dad was a land man just like Al Pacino... and Jack Lemmon would have done better if he did what my dad did.. my dad bought a printing press and I had to make door hangers after work then on weekends I had to put them out door to door.. so my dad got 20 leads a week and did not use the company leads like everyone else.. soon was number one then in 2 years started his own company... thanks for the memories.. my exerpince with this company is on the front lines one of my vendors bought a property through these yahoos  total fabrication on the rehab and resale value these guys are ruthless in their approach and in my mind have little concern other than to make a fee and move on totally CAVEAT EMPTOR if working with these folks..

@Nathan Estochen it also depends on the contract you guys signed.

I met with the guy in person the weekend after and asked him to give me a more detailed estimate (at least the high ticket items).

What do you guys think about my terms and how should I structure this?