It's more about the numbers than the color of the carpet and walls. 

Lenders want you to have skin in the game, as well and that is why secondary mortgages when purchasing. 

The hard money lender will lend based upon the actually purchase price of the home, not rehab priceieforclosure house is 100k, they will lend 75k, and want you to get skin in the game, so u cover 25k, but you know once rehab house is worth 200k.

MORE THAN ONE WAY TO SKIN A CAT.Why not just buy some extra insurance to protect the asset.People only sue when they are mad, OR when someone has done something stupid.1)don't piss people off 2)don't do anything dumb 3) carry liability insuranceFollow those three rules and HOW you hold the property really shouldn't matter.

Down payments are your "skin in the game" to the seller, if you default, they keep your down payment.

I am so glad I took my time because his true colors eventually came out!

Nonrefundable.If this is a nice house you want to do your due diligence on the buyer, and make sure that their credit is good so they can get the loanI would get a new appraisal that would come in at your sales price and sell at that price.I would get a property manager to come in and do a property rental analysis based on market rentIf I am selling a nice house I want to do a lease purchase versus a lease with optionI want the house so I don't want to give them a chance to buy it and it's a maybe maybe not purchaseIf the purchase price is 400k,  3% is 12 grand if they have that kind of skin in the game plus being read to take care of the propertyIf you think the market is going to drive the price up and you going to lose money by selling now, then give a lease and a ROFR or right of first refusal, which will allow them to buy the property at new appraisalYou may want to work with the commercial real estate attorney that deals with creative financingAlso due to Dodd Frank I would still use a RMLO and pay The RMLO (registered mortgage loan originator) to underwrite the buyer if I were doing a lease purchase or lease option.

Hard money lenders will require you, especially as a new investor, to have "skin in the game" of generally 35% of your purchase price. 

Hopefully others will chime in but I am doubtful that you could secure financing on your own without putting substantial skin in the game ($$$).Best of luck!

Thick skin is a must in this industry.Feel free to check it out - http://www.biggerpockets.com/renewsblog/2014/07/05/getting-lowest-purchase-price-possible-skinny-real-estate-negotiation/I hope your find it useful.Thanks and have a great day.