I've also read that investing into an LLP as a partner has different tax implications than other forms of investment.Needless to say, I'm confused and frustrated.Can someone help me understand this using some arbitrary numbers for illustration purposes?

Though this did not lead to an investor for me, it does illustrate what you need to do. 

Paying UDFI on the leveraged portion of the investment might reduce the return from 15% to 12%.While not as good as 15%, a net after tax return of 12% is still better than 8%.Please realize that these percentages are purely made up to illustrate a concept, not the magnitude of the return differences. 

First thing out of his mouth "darn these machines ae HEAVY".Sorry you took it as condescending but it illustrated the point, find a cash based business to start.  

This thread illustrates the difference between investors and rehabors - Investors buy houses and write checks to contractors - people who rehab may do much of the work themselves.

It is well illustrated in the book 1984.

Not sure if it was a legitimate story, but it illustrates an important point.I suspect though if this situation is real that the investor has not yet seen the end of his/her troubles.

If you're like me some examples with numbers will help to illustrate the point.Lets say you do a HELOC or cash out refi on your house and get $70,000 dollars cash to invest.  

Brian:I do like the idea of providing transactional funding and have done it one occasion - the recipient was not a wholesaler, but a rehabber who got over ambitious on his commitments and could not swing everything in his pipeline ... but keeping his reputation untarnished was worth the cost of bridge funding.The issue I see is that I would not extend funds to most of the wholesalers with whom I have had contact for many of the reasons illustrated above: they simply do not have their act together sufficiently to give confidence the monies would be repaid.  

(whole integer increase every year is unlikely but illustrative of the analysis)First, by the example cited, the 5th year also becomes the max rate, so if we hold that long, we will know the highest rate forever.