Effectively, my offer was 40% of the list price, and i justified it saying the repairs would be at least again the value of my offer.

Curious of what your most effective way of finding properties is? 

You will in effect be managing the property for whatever the cash flow is if you have to give it back in five years. 

Net effect will be the same,  but you're freeing up a Fannie Mae "number of financed properties" slot every 7-8 years instead of every 20 years. 

What other types of marketing are effective for wholesalers?

It's simple, but incredibly effective.

I did take over someone's contract last year on deal, but usually it is more cost effective for me to pay more on marketing myself than buying from wholesalers. 

Perhaps there are more effective ways to "offset" capital gains, but this has been my experience.  

Do you have any tips on setting this up effectively without breaking the bank on legal and other filing fees?

It's usually pretty close to a wash, or when I hold the rate constant it's like 20 basis points (to price, not to rate) or something trivial, coin toss which will win on any given day.I prefer to have my direct lender hat on to my broker hat when working on REI deals (not licensed in your state, don't actually bother PMing me) because your situations are always wonky and I need that direct telephone/IM/email line of communication to the assigned decision making underwriter so I can go over your net loss carryover, or weird Schedule C, or funky deposits, or whatever it is, with her and get it resolved in 5 minutes rather than over the course of 5 days of emailing back and forth through some intermediary.