Quote from @Richard Kim: I'm a fairly new small time out of state investor who owns a couple multi-family properties in Cleveland.

Work out a fair revenue-sharing model, such as a flat lease or percentage of profits, and consider hiring a property manager for oversight.This post does not create a CPA-Client relationship.

@Jeff G. not aware of that, but sure it's available for a price from Fair Isaac Co or one of the credit repositories.

Sets up automatic requests for rent, and is a fairly bare bones but SUPER easy to use system.

Need some advice on the best way to structure this deal that's fair and beneficial for a 3 person LLC/partnership agreement. 

I understand being in high cost market and it being difficult to buy but the "cash flow on paper" inexpensive markets is a gamble.

A local investor will be best equipped to get repairs and renovation done at fair prices, set rents at appropriate levels, and help select qualified tenants.

Totally fair.

It also takes 2-3 weeks to invest 10k with Prosper, so it’s not like on day one you invest and one month later you receive $300-320 back, so seems like you would need to be fairly diligent in record keeping to ensure you are using those payments to payoff the high interest loan. 

However, it's fair to question the integrity of the management since it's in-house.