To your questions:1) There is no need to record a purchase and sale agreement, but there is a need to record any type of conveyance (transfer of ownership) of a property, no matter what form of sale/financing.  

All this assuming you were local.If the deal doesn't work out, I could happily sign a contract saying the house will be transferred to the buyer if anything messes up with flipping.There are a ton of ways to make it a "safe" transaction for the buyer.But in any case the way I see it...

After receipt, I transfer money to main account which I use for paying expenses for all properties not managed by others. 

I have all my tenants wireless transfer money via Bank Transfers.

Profit: $80k-$60k=$20k Transfer and recordation costs : $2k Net profit: $18k abc and xyz each get $9k your thoughts on this is note abc is bring the deal and assigning it to xyz. xyz is funding it and holding it in a llc where xyz is the only managing partner.

Might be able to balance transfer to lower short term rates to increase cash flow.

Will seller transfer deposits on the HUD or outside of closing?

We avoided real estate transfer taxes by having the owner transfer the property into an LLC and then buying the shares of the LLC from him.  

Maybe you can have them transfer ownership of their vehicle to you now, and when all is paid and up to date, you can transfer it back (all fees they pay for). 

From the start we're purchasing properties under our LLC instead of our names and transferring.