So steps are :Create promissory note plus deed of trust(if needed)Buy property cash (using all parties funds)Renovate propertyRent UnitsRefinance property under a new loan (with your name)Pay back partnerChange Title to a holding LLC or yourself (Could be done earlier)That's it.

With my specific situation, when we put in our offer (going up against two other parties), we included a $5,000 seller's assist upfront. 

I would also have a  third party hold t he money.If they do not give you the money back, immediately go down and place a lien on the property. 

Now with that being said, we have run into a lot of parties in certain parts of cities with colleges or younger populations.

I have 15yrs experience in the industry but my company does not do 3rd party management at this time.

Which part is exempt?

Generally "losing party pays winners reasonable costs" is allowed. 

Perhaps a nice 1950's built bungalow.Always hire a 3rd party property inspector to give you an unbiased feel for the home.

A set portion of the closing proceeds to be held in escrow by a third party until released by both you and the seller.3.

The important things to consider are finding a single family on a multifamily zoned lot, number of parking spaces, number unrelated parties allowed in that city/county, and overall lot size (for future development).