if you are talking interest only loan

the interest will be the same everymonth, has nothing to do with amortizing over 35 years.

and what are you hoping to acomplish at the end of 2 years if you only do interest only loan? appreciation of the property?

if you don't pay down the principle, the appreciation usually goes up 2-5% a year.

I am in indiana too, to me the deal is not worth it.
try to find something in the 75k range, rent for 800.