I'm not well informed on build costs in NoVA but I'm fairly certain that renovation costs will be a lot less costly but with more headaches.

I noticed you're from NOVA, I grew up there and lived there until I went off to harrisonburg for college.

If you are in the Nova DMV area and might be interested on this deal or future ones, I would be happy to get in touch and provide further info.

He is a loan officer in the DC/NoVa area. 

I look for creative deals in NOVA and look for mls deals in other markets.

DC has way more options than MD or NOVA. 

I know the standard in NoVa is 25%. 

I am out in Winchester and work in NOVA and in fact have done work at DOL.

Then "buyer" friend financed the property with a VA loan.In the VA Lender's Handbook, it states:To refinance an existing mortgage loan or other indebtedness secured by a lien of record on a residence owned and occupied by the veteran as a home.Your best bet is to go talk to a reputable lender in your area- I like Nova and imortgage here in Arizona and I believe they're located in CA, too.  

A VA IRRRL requires 6 mortgage payments to be made prior to being able to refi with this program.Its a strategy to reduce your VAFF which was traditionally 2.15 - 3.30% down to .50% since on VA IRRRL's you only have a VAFF of .50% which is substantially lower.This allows a vet to get into VA financing avoid the VAFF upfront (yes they have a higher rate due to payoff of the VAFF) and reduce that higher rate down to the current market after 6+ months usually at no cost since VA loans have a ton of margin to issue a lender credit.This allows a borrower to get into a VA loan with essentially as low as 0% down and no VA funding fee (ultimately after the VA IRRRL).