Paying them separately gives you a few extra months of letting the money sit in an interest bearing account but that's about it. 

I'd like to earn decent return on it, and like the idea of financing real estate rehabs, either as a partner (the money), private lender, or hard money lender.

Put the money to work earning 12%.2) I would lean toward this option as it gives you some level of managment efficiency, plus income security with the multiple doors.

IO loans work well for properties that you can force appreciation through value add improvements, but need extra cash to do make it happen.

My plan for years has always to buy a property that not only helps pays the bills, but also will provide some extra income in the future.

Even though the houses are both completely remodeled, I would still set aside the extra $100/month for maint/repair. 

How much more rent can you get for that extra bedroom?

My current hurdle has been trying to put myself out there more and start networking to make the right connections so that I can streamline my process and be able to offer quality and honesty to any of my future clients.Anyways, I started watching Bigger Pockets on YouTube and have been spending my extra time lately reading more of their books and articles. 

I used to work as a GC for many years and on top of all materials and labor my compensation always included and extra 10% just for me.

Might still be a good investment but will add extra headache.