How will the loan work exactly?

Bank loan on reno & cash purchase.

USDA Loan depending on location, ideally 0% down3.

Michael - When you say "loan" - what are you meaning?

My appraisal came back low and the loan amount and down payment are now changing because of this.

I'd talk to them and explain the situation and let them know what you want to do to remedy the situation.

Since it is a roommate situation that might make it even easier.

Investment Info:Other private money loan investment.

HELOC:Pros:Flexible borrowing - borrow as needed giving you flexibilityLower initial costsVariable interest rates - can be a con if rates rise, it can also be beneficial if rates decreaseCons:Variable interest rates - rate can fluctuateMore risk of foreclosure - you're adding a second loan

Here is what is being considered:SCENARIO 1):1) Parents loan us money at X% rate.2) Loan terms would allow for early payment without penalty (we would get a conventional loan in 2-5 years to pay parents back).