The problem is, many of the Banks don't treat Investment Rental differently for fear of the OCC coming in and fining them.

Syndication is a business and needs to be treated as such.

I think you'll be best off, however, if you make an honest effort to not just treat the situation like a payday and find something that works for both parties.

Can a simple 8-10% loan work vs giving up equity and how is the investors money treated in a scenario where the deal loses money vs profits?  

Your exterminator can walk you through how/what to do to treat all of their belongings. 

Treat them with respect, explain the contract to them, and emphasize how your are in compliance with it.

@Andrew Johnson covers a portion of this as he mentioned factoring in his rehab cost during his initial stages, not sure if he's referring to long-term property holds of 20-30+ years.Also keep in mind these strategies will change based on property type, SFR, Duplex, Quads, etc... will be treated differently than a 20 unit building, which will be treated differently than a 120 unit asset, and so on.... this will also get you different replies to your question as the different debt structures will fulfill different requirements of the investors.

They pay early, treat the house as though they own it, etc. 

Whether that is treated as boot that is depreciation recap or boot that is taxable as gain is accountant by accountant. 

But you did not treat it as a partnership, even though maybe you should have.Split 1099-S will help you.