The 5% difference accounts for fees, carrying costs, etc beyond just the rehab.

The pipe carries any water away from the house.

@Alexander PerskyThere's a few disadvantages to 0% down:1) No equity in the property to allow for market fluctuations.2) If you are using a bank, you'll be paying PMI which now has a required carrying period.3) Interest rate will be higher.4) Monthly payment will be higher so harder to cashflow.There's lots of great reasons to do this sort of financing.

Looking back now, there was a truly incredible emphasis on "not screwing up your future," an immense fear of risk that carries over from high-school mind control, pushed into your brain by the people who work there, all of whom spent years getting along to worm their way into a unionized low-to-middle-income teaching job, in large part, by jumping through hoops and never doing anything that might lead to their getting fired out of a government union job, or, to put it as teachers do, "jeopardize their position."

I would have to carry that 1% for at least the other 7 months. 

I did my homework on the property and found out from my Insurance Agent that roof shingles would have to be replaces because no Insurance would carry out policy on this property once I acquire.So we are about to sign a contract with a seller that has no cash reserves to be able to replace roof shingles.

The only debt we carry is for the wife's car.

@Eric Carr I would love to hear your thoughts on this question of mine as well.

Seller willing to carry a contract for 1 yr with a $25k down payment. 

Then, these would be added to your basis and carried forward to the new property.