Instead of selling our house, we have decided to rent it.

Not sure what you gain or how you exit the heloc without selling the property you paid cash for.

It has appreciated a good amount and I am ready to sell it for a decent profit various reasons.

He can't buy, rehab and sell for profit consistently.  

Work with the realtor to minimize your listing costs but do incentivize them with commissions if they sell your property above a certain watermark above your listing price. 

My investor plans on holding this property and renting it out for north of $3200 for a few years then eventually flip it with a goal of selling for $560k+.

The folks trying to sell you something on the internet probably won't say this, but you need to spend some time in your market before and after your purchase.

I.e they get 0% interest on the 500k, but they get some of the cash flow and some of the profits when we sell? 

Imagine a realtor selling your house and getting you to sign on sales contract for a certain price only to learn the realtor was getting a kickback from the buyer for getting the house bought at a lower price? 

Did it help you rent/sell the property faster?