Value Add properties, which means they all require some level of upgrades to maximize rents.Sophisticated investors seem to like the Waterfall Equity Split like you described...but the average investor finds it complicated.  

And that is something you can actually use to your advantage when talking to them, assuming they are calm, reasonable and rational when you try to talk to them.You explain that you have an attorney on retainer prepared to file eviction, but would prefer to allow them some time to locate alternative rental housing first since the eviction filing could hurt their chances of acceptance with most landlords.

@Bill Exeter thank you for your email yesterday that calmed me down a lot as you know real estate can be stressful especially your first time.  

So I met with one group of students who seem very orderly and calm (not big partiers).  

Having a multi layered waterfall is another option over a straight profit split which is also more typical of a syndicated deal.

The way I see it is the bank is 1st lien through $450k and my ~$70k from the renovations is next in the waterfall.

I then came back and pointed out the avocado village parking policy and cc&r there is no policy that states that you cannot let your neighbors know that there car is getting towed.....if there was such a policy not only would be a creepy type of invasive policy...but it would truly violate our civil rights as americans to practice freedom of speech... the lady then came back at me and said "lets cut the ********" which then the only male HOA member calmed her down and pointed out that she must remain respectull during the hearing...I the responded and told her "yes lets cut the ******** and get down to brass tax...why are you sending me notices that we are in violation of hoa policy by making our neighbors aware their cars are getting towed..." truth is there is no such policy and if there was it would get trumped by a little document called the constitution of the united states...The hoa could not provide me with such documentation.....I then asked them to explain to me what the definition of "interference"was they did not have a clear definition so they tried to turn the question back on me by asking me what i considered interference was.....wait what?

I found my calm when I just went with my gut.

You might see a 20% split to the sponsor and 80% split to the rest of the investors...it can be 25/75, 30/70, 40/60...there can also be "waterfalls" wherein the promote split might at 20/80 up to a certain IRR, then goes to 30/70 at a higher IRR and then goes to 40/60 at an even higher IRR.

Any advice would be really appreciated to calm my nevers about starting at square one in an area that I have no sphere.