I have gotten 2 this year so far on the market that pencil for us at roughly 50%+ return cash on cash after lending and holding costs

The CF is only playing catchup to the cost to you of the property. 

However, the success of your project will depend on factors like location, renovation costs, and market timing.Many investors have found great success by focusing on high-demand neighborhoods with strong buyer interest.

Asked Price $290.000Purchase Price $260.000 + Closing Costs How did you finance this deal?

So, this cost a bit more in closing costs BUT your are out 34,750 plus closing costs instead of putting down 25% of the 340k which 85k plus closing costs. 

My son currently lives in the townhouse b/c he is going to school and works in the area.Since he is young and starting out in life, I would like for him to only cover the basic costs (taxes, HOA, utilities) just enough for me to break even (I believe that will put him slightly little lower than market rent rates). 

The reason is that for most programs anyway the 60% loan to value will give you the best rate and best cost available and of course you should still be able to have a healthy cash flow at that loan loan to value.

Delays, unforeseen repairs, and underestimating budget up front are all much more dangerous occurrences once a gap lender is involved. 

And the other way, if you’ve worked with someone who you absolutely would not use, please share as well so i can avoid them at all cost :). 

Things that would be helpful to know: how much are your holding costs?