Of course i will use the caveat that "it depends" but typically yes the $50k investor would get 50% of the promote of 70%, which in this case is 35%.

NEVER ever send a lender money in advance other than maybe a small deposit like 100 or 150 bucks to run credit etc.. and then most will have you pay for the appraisal directly.

Consider using the equity in your home with a HELOC (Home Equity Line of Credit).

Buy the home in an LLC with a hard money lender for 2.6 million with a 900k rehab credit written on both sides of the settlement statement.

I hope you still plan to screen her properly, credit check, and check with her previous landlords, (not the last one).

I've also seen entire lines of improvements encroaching in a daisy chain because a marker on the ground was mis-identified.Lastly, while I may be giving your loan underwriter too much credit, is it possible the underwriting objection is the existing loan on the neighbor's property? 

I would also ask the DA, hypothetically of course, what would happen if I then did option 2 or 3 and the ramifications of such.2) Nothing.

What I am really struggling with as I develop my strategy is; why would anyone finance a deal vs paying all cash (assuming you have enough cash resources of course).As an example, assume a turnkey house costs $200,000 and rents for $1800.

If your credit is stellar and you have some cash reserves, you may be able to start with a hard money lender (HML), but they will likely only finance 80%.

If you buy 5 properties with 20% down vs one property with 100% down, if the market goes up 10% you earn a 50% return instead of a 10% return.Of course life is not that simple.