He already has the $50k with the hard money lender however they will only release funds once first phase of the project is completed. 

@Brian KemplerThis seems very sketchy especially if there is another lender in first position.

I'm reviewing the loan document, and I noticed that the total closing cost is $12,374.

I am yet to get one though, but I am eager to get my first and be there every step of the way so eventually I can be the head honcho aka the sponsor of these deals.I am getting a bunch of leads every week, through brokers, lenders, PM's, etc but mainly through brokers.

Read the contract or have an attorney review the contract to let them know if you are able to cancel.

As far as funding I have a few great investor lenders I send all my buyers to get deals done that make sense.

It is true, a lender will not look favorably at a scenario where the borrower is relying on a loan for the down payment.

You can also seek advice from lenders and brokers on finding a suitable real estate mentor, most will be able to provide one.

Can an attorney review it and ask for changes sure, but why spend the money?

I have been taught that some private lenders do not require money down.