Did your borrowers mention securing your investment with a recorded mortgage or deed of trust, personal guarantees, lender’s title insurance, or anything else?

IMO this is much too little additional return to put your personal residence at risk.  

Most people that I know buy Turnkey because they want a monthly return on their money rather than a long term equity position an appreciation.

https://app.box.com/s/4sedcgxd2eqou5ugizjspk406zbp75aaI have absolutely personally nothing against Mr. 

For lending, your rates are going to be higher than if you were to buy under personal name.

You could present a hard 10% annual return or an easy 6% and they would take the 6%.20% return on 100k dump house and area is 20,000 a year.

Being $50-$100 off one way or the other in a monthly payment makes a surprising difference in your rate of return.I'd also familiarize yourself with how you want to measure rate of return...

The cap rate is not equal to the return for the investor (or the GP either).

You are brave person to able to say that in bp lol

If Person A had any claim to the deposit, it would have been right after they left, which apparently was over a year ago.Your agreement is with Person B and that's who you would return the deposit to.