@Jesse LeBlanc, I still don't see what the point of any arrangement the seller/borrower and the lender had was.The only thing I can GUESS is that by overpaying the lender grossly, they will receive that residual money after January 1st and be able to book the profits in a different tax year.

We have a friend/business partner who would give us $37,000 and we thought we would put about $10,000 and we'd split profits as 63% for our friend and 37% for us.

So, it could be an opportunity to pocket TAX FREE profit. 4.

Expenses can eat up profits in less expensive areas. 

Nonetheless, the only way for him to get anywhere near the profit he's looking for is through seller financing and since he owns it outright that's a solid option. 

Or buy a fixer upper and work on renovating (valuable learning experience if damage not too extensive) during college years then sell and keep up to $250,000 tax free profit as your primary residence allows.

With that being said I think you will find the multi-family model, 2-4 units more profitable, than a SF.

Bottom line was a $1,325,000 profit on a $1.775,000 investment in little more than a year and a half.  3.

If they get paid up-front, how hard will they work to make the deal profitable? 

We got the seller a quick and easy sale, while adding a profitable deal to the end buyer's portfolio What was the outcome?