I'm seeking advise from people who may have been down this road before on whether we should seeking other financing methods to go LLC to LLC or quit claim the lot back to our personal names to satisfy the 1031 exchange rules. 

I’m trying and learning as I go.

I would talk to a local bank or mortgage broker to see what you can get for a loan first and then go from there. 

So I had a solid enough down payment that I thought, why not go out of state where it's cheaper, where I have friends who've been successful and can get more bang for my buck?

but if i go in a LLC with them i get hit with the tax from the sale of the homeThe GC and the flipper were just going to split the profits from the sale of the home and they were going to pay me 2%/12% for the duration of the build. 

There's nothing wrong with considering them along with other options, but I would be careful thinking they will get you more bang for your buck or a more honest operator.Remember: cheaper doesn't mean you'll make more money.Start by going to www.narpm.org to search their directory of managers.

If you decide to go out of state, I’d recommend starting with turnkey properties and having a property manager handle everything.

It sounds like there could be a few things going on.

I personally would go that route as it would probably be less expensive. 

You can go into contract on your purchase at any time - even before your sale closes.