Their profit is essentially guaranteed, locked in for their piece of the pie.But then, you hit that big payday.

But when this step is pulled off from the bottom rung, the payday is huge.

Repayment terms are flexible (not payday-loan predatory stuff).

But when this step is pulled off from the bottom rung, the payday is huge. 

We do not base our decisions on a "payday".

Anyway, writing down all the stuff that needs to happen to get this deal to the end-zone of a payday, including realtors, title co, etc... needs to be assigned to someone so that it's later not misunderstood. 

The rate on the second almost doesn't matter, so I would have the rate for the first and second be the same to keep it simple.By doing it this way it gives you 3 things, cash now and up front, cash flow, and future pay day when they sell or refi.

Cash flow is important but you'll always have your biggest payday when you sell, so appreciation and principal pay down are the biggest factor to your net worth.Good luck!

I realize that is another revenue stream, but that seems like that would take your focus away from the larger paydays. 

sounds like this contractor was just looking for a big payday.