After winning the bid I had to provide 5% of the price as earnest money within 1 day of the seller countersigning the contract.

This also leads owners to ASSUME simpler is better when it comes to management contracts.

I would search the BP forums because your tax / legal related questions likely have already been asked.However, it doesn't hurt to still ask the forum what your questions are.

If you need financial help, ask under the "Finance, Tax, and Legal" forum.

If need be, I can/will go down the legal path again, but I would like to avoid it as I want this property flipped ASAP. 

Are you under contract? 

Now with the NAR settlement, all buyer commissions are negotiable in the contract. 

@Brittney YangFor the actual legal document, get an attorney.

You have to prove you did everything right and then because of “empathy” for the poor snook who “fell into you schemes” you may lose anyway.This is a legally binding transaction that will be treated that way by the law.

Suggesting to them buying their house for a wholesale range offer or lower dependent on the extent of the rehab, then having a contract in place that gives them a percentage of the profit to help get them back on their feet, paying off debts etc.