This way you retain control, using your expertise, and you are compensated for all your work.

I am guessing they may be looking for some hefty compensation for house cleaning.

Two years is preferred, but if you have compensating factors that can be waived.

If you're too busy to take a job soon I'm happy to compensate for your time to look at property and give me your thoughts as well and hopefully we can work together.

That being said, fairness would dictate that they should likely be compensated something for their preparations and allowing you out of the contract.

Being a custodian and holding / managing money for another person is not taxable to you.The only exception would be if you are being compensated in some way for managing their money.

I am a paid member of both Reia's but get no compensation at all from them. 

(http://www.dealmakerlibrary.com/which-entity-is-best-for-flipping-properties.aspx) Nancy,Reasonable compensation is what you need to consider, you would be paying the a bit more doing so personally; however, Most flippers utilize a corporation.

You will with lots of time and practice and learning from your mistakes be able to walk a property and know what's up with....BUT...if you have an inspection period you have the right to back out due to inspections....well...Instead of just walking away and losing the money you just invested in the inspections, you ask for additional funds to compensate you for what the inspector found. 

FHA is the exception if you want to buy a 2-4 Unit as a primary because its only 3.5% so there is a benefit on that scenario.Most Lenders/Brokers charge points or have to hit their "loan officer compensation plan" AKA bucket.