He has a good track record, but I have never lended money so I'd appreciate any guidance in how to set the terms and what steps are critical to ensure the relationship doesn't go south.

I prefer local credit unions & State banks.  

Your credit has to be above 580 for 3.5%.I would be careful when tapping into your current property's equity.

(or IS one of those people)....that would be interested in possibly forming some type of partnership to look for deals and find lenders, so we can show them some form of track record.I have a pretty strong network and strong networking abilities in-person.

If you "jack" the rent up (even if you find a tenant willing to pay it), typically the appraiser will not give credit for additional value above and beyond what market rents would determine.

Since you allow people people without the credit or means to buy.

If you didn't have a successful track record investing out of state I would say maybe sell maybe not. 

It's some questions that most hard money need to know.1) what's your credit score2) how much cash are you bringing in?

Side note: They said they have a 800 credit score and are currently paying more a month. 

I past the test first try, and credit the hundreds of practice questions the school provided.