Rereading OP's post, I would suggest running this arrangement through a loan servicing company that has a licensed mortgage broker experienced with hard money. 

You still get the benefit of their experience and I think it would be a less complicated arrangement.

You should have them contact their insurance company and they can work out the arrangements for them or if they have a case manager that can help them look up skilled nursing facility near them.

To help prospective buyers envision possibilities, a great approach is to virtually stage the place, and also offer alternate floor plans.

Making this a little more messy, is that the person asking setting up this arrangement is a family member who has been able to use the space rent-free for several years.

My arrangement with partnering they bring the funds to close and front the reno and I handle all the construction and sale of the property for a 50/50 split of profits, well I guess that's just not good enough for people.

I heard Lil bit about fha loans want to learn more or how can I come at this first stage Lil better?

Currently I am in the due diligence stage and looking to get estimates of what it costs to build per square foot.

If she's good, she can either provide 12 post dated checks, or arrange to have you paid automatically each month via electronic transfer.

I want him to feel secure with the arrangement as well, so how do we word an agreement so that he also has some certainty that his work will be deemed satisfactory and I can't just say "I don't like it" and break our deal.