Given your relatively low rehab budget and relatively small spread, here are the two things you should double check before jumping in:1.

You need to find out if your relatives goal is equity growth or cash flow??

Did your relative ever find a way to sell?

I'd recommend at least the former, just to make sure everyone is on the same page, but the degree of formality you take it to really depends on your relationship with the other partner.I'd say be clear with your relative about whether they are a partner or lender, and outline each person's responsibilities.

No matter what the path, you will have to agree on a price and buy out your relatives, unless they are generous enough to give it to you. 

You might be approved as a landlord but if you want to rent to a parent, child, grandparent, grandchild or sibling, there are special rules to follow that basically have to do with your relative being disable and having no other choices.

It comes down to what you expect to get out your real estate and your relative risk/return profile. 

@Vincent CarminatiI would speak to an attorney/accountant about the LLC structure but one LLC per single family house might be overkill.In regards to transferring money; why doesn't your relative place a mortgage on the property you are buying to keep everything clean?

Once you obtain your REL, do you have to work for a broker to "activate" your license?

with your relative in 2nd position....What's the worst case scenario?...