I've come across some deals that the seller is willing to hold back a second mortgage of 15% and another deal where the seller was willing to hold back a second of 20%.  

@Tim Powell go to any bank and sit with a mortgage lender.

If your mortgage is higher than 45% of your rent rate, you're probably not in the best position if you have an investment property that is going to have a higher vacancy rate or maintenance load.

The Assignment of Mortgage/Deed of Trust does not seem to have a specific allonge with it.

And i doubt conventional loans would help here (especially if the house needs work).Has anyone purchased property with a LOC and then rented and refinanced the property to pay it off and leave a mortgage on the property (paid by the tenant)?

Even if it's nominal, or even if you get no additional rent, working on the place while occupied is cheaper than having it sit vacant while you do that work.

-Do you encounter any issues with refinancing mortgage with lender to put under LLC?  

I know my DTI is high due to having several mortgages, but they worked with me and got it done.

I want to start the process of applying mortgage loan for my first investment property.

I think they are probably cheaper than what you have been quoted, but then again, it depends on the area where the flip is located.