He would email me the invoices, lien releases, an occasional photograph, and I would send him checks to distribute.You never want either party in any kind of tempting or compromising position and you both want to be able to walk away cleanly if things don’t work out.

Business has no debts or outstanding invoices.

If he's going to be your big-picture contractor for the whole rehab, he'll probably do that for minimal cost on labor, meaning you can avoid hard money for something relatively close to the $150 each, and not the $150 each plus what works out to $300/hr for labor (it takes 15 minutes to install them and anyone that can work a drill can do it, but on paper we have to show that someone is "Qualified" to operate a drill that will send an invoice specifying the work and charge for labor bla bla bla... that's just one example).I do a lot of straight talking to contractors/investors about "ok let's figure out the cheapest way to check this stupid Fannie Mae box and keep you away from 14% hard money financing... y'all can figure out the 'real' comp later, here's what the paperwork needs to say" - reach out to me if that's something of interest to you.

Also provided him with the invoice the GC provided to me.  

The lien that was placed on property B could have been (1) of (2) options; an unpaid invoice from the lender (not the actual mortgage) for outstanding costs incurred by the default.

(Sorry my inner CPA speaking to you).To get the money back from the lender and after you complete a capex project, you submit invoices and cancelled checks to the lender.

Throw in this folder: Closing Disclosures, mortgage statements, settlement statements from the purchase/sale, homeowner's insurance declaration pages, property taxes, leases, and receipts/invoices from one-time BRRRR rehab expenses.

Hence, any fees mentioned on the closing disclosure has to be supported by an invoice.

They also want to see a detailed invoice for the work. 

Barring disaster though...If you're looking for investment and the Denver metro /Front Range (because even Ft Collins and Greeley are pretty danged hot right now) is too hot for you, then you may want to consider something in another market.