@Travis Andres you've got some good comments above but I would like to say something a little different here if you don't mind. 

If the former, ok that's a bit different.

They have several properties in different counties. 

Saving $10k or $20k off a purchase price is maybe $120/mo difference in payment.

Is this scenario any different than a hard money lender lending 100% (we did find one), paying as part of the rehab cost, a contractor, and only reaping the benefits of the interest and points he would charge?

So, I'm addressing a primary home with a different perspective than an investment property.  

if you want Zero risk then park in your brokerage account and buy USFR, a wisdom tree ETF, pays 5.39% interest, holds 8 week UT treasury floating rate notes only, so you don't need to worry about FDIC or SPIC insurance as only way US govt doesn't pay is if we get nuked, then you won't much care about Yieldif you ok with mild risk, I put my emergency funds cash into a group of different BDCs i like, these are business development companies (mini-banks) that make loans to small to medium size companies.

Absolutely agree that every situation is different.

Some may not agree, but think I would rather avoid mixing different guest preferences and recommendations for future guests.

SeanOther banks may be different but I have a savings account at the same bank that holds my heloc.