Funding Rehab For Share Of Profits

[John White]

Good Afternoon All...

I need some advice, as this is my first scenario where I've been approached to fund a rehab. Here are the details:

3 bed, 2 bath cape, 1500 square feet, .68 acre lot (large lot for area). I can purchase the property for $85K and sign a contract with the contractor for the renovation ($30K). All in, I'm at $115K with an anticipated sales price of $150K (he believes closer to $170K, but my comps aren't nearly as ambitious). Here is my dilemma. The contractor has a lease purchase on this property (I've already reviewed the paperwork with the title company) and must close on the sale by February 15th. He is willing to share the profits with me 50/50 if I just fund the rehab. While on paper, it's a superb ROI, how would I structure the deal to protect my share of the profits and my $30K in renovation costs without purchasing the property and taking title? Can I put a mortgage or lien on the property to protect my $30K investment, without taking title? If yes, how would I then protect my share of the profits (I own a brokerage, so would insist upon listing the property when complete) to ensure that I'm not just guaranteeing only my $30K back (which would amount to an interest free loan)? The property does not currently have a mortgage on it. Any and all advice is most appreciated.

John