However, I'm looking at creative ways to produce cash flow with little to no cash down.

(Not actively purchasing as my money is tied up in the market right now)...so with the 2 lenders i've gotten here:STR DSCR Rural (not a log cabin or other non-conforming structure) just remote sfrHybrid loan 15% down, interest only investment loan with seller paid points to get to ~8% and reduce closing costs DSCR would use long term rental rates to establish monthly DSCR and then offset monthly with average DTI and 800+ credit and high cash reserves as long as DSCR is .75+additional appraisal to establish STR rate estimates to be used alongside the standard long term rental rates5 year prepayment penalty with reasonable terms

They then decide if they are willing to list with the agent.If you have substantial capital and can close quickly, with cash, no inspection you might be able to do what you are suggesting.But a bank is incentivized to get as much as they can, with the least amount of hassle and they will believe their real estate agent before they believe you on numbers, closing time, availability of funds.

it's also a strategy that takes cash. 

My questions are: Does offering $375k to break even but cash in on equity make sense?

I actually prefer these systems because there’s no cash/check to deposit at the bank.

The cost of entry is low while the cash flow is high.

Ultimately, the goal is to add the property to your rental portfolio for consistent cash flow.

The MIL has owned the property for 4 years and there is no mortgage (purchased in cash by her grandson; I raise this to you in case there are capital gains implications for MIL and DIL when the latter sells). 

I will live in the home for 1 year and then reevaluate whether to make it a cash flowing rental or simply flip it.