I've also read conflicting advice on valuing a buyout amount, if you take the net proceeds of a sale and split it in half or if you pay half of the appraised value minus the mortgage debt. 

I am currently paying off all my debt to allocate money into the rehab.

I always think installment loans (like hard money) is better than revolving credit debt.

If the owner is open to hearing options then you can lead the way with your terms and balloon structure and see how they feel about it.

You're looking for a system like Batch Leads.

I was able to talk to several great leads, but when it came down to locking up a deal, they don't even provide you with a Purchase and Sale agreement.  

The Note is the debt (evidence of it, technically).

One thing I am hearing is I need to be Lead Based Paint certified, even if only the contractor does all the work.

You receive the piti from your buyer and you then pay the underlying debt with that payment.

If you are going to lock in that debt and let it sit, it's not wise.