I plan to get a 30 year commercial loan and my broker is telling me that 6.5-7% is more realistic for an interest rate using a complete underwriting process (3 years tax returns and credit check).

The back-up plan is to simply flip the property and take the cash out now for the next project.The Project (2 unit Multi-Family):Acquisition/rehabLand Acquisition:     275k (I'd use my cash to buy)Hard Money Loan:  100k (I might use my home equity line at 4% APR over 20)ARV:                           465k (This is my best assumption based on other comps)Refinance:                348,650Cash out:                  26,250Income:Rent:                         1800x2 (This is conservative)Capex/Maint.          300x2Expenses:                400 (water/trash/electric/sewage/insurance)Using these numbers the property looks like it generates a COC return of about 30% per anum (on the 26k outstanding).

Downside is you have to share the profit, plus side can be zero dollars out of pocket.Option 3: If it's a deal with good monthly cash flow and cash on cash return then suck it up and pay the 20%.

A few questions about how the returns get disbursed in a syndicated MF deal...1. 

If you are claiming your income on your tax returns, that should be enough to document your income.

A skill set they do not have access to, is something of value that you can provide in return, without money.

The returns here are attractive to out of state investors.

My first property has brought me a 34% net return in year one.

if they say no way, you know your not going to farce appreciation without removing them...if they are agreeable, ask them what their expectations are and then take it from there.Most tenants want something and will pay for it in return.

I'm thinking 6 or 7% would be a good return for him, as that seems to be pretty good in terms of getting a loan.I'm thinking we'd use his money towards a downpayment (we're not sure how much he has currently, we'll be finding out in a few days.