Based on my research (including RDPD), it seems that minimizing the initial down payment and using available cash for further investments is what's advised (+ pull more money from refinance when the value increases later).

Most folks are attracted to REI because there are a lot of different levers to pull to force value/equity.

Here is how most work:Rates: 10% to 14% (Most Deals are 12%)Terms: 1 Day - 24 Months (Most Deals are 6 months)Fees: 2-5 points(%) of loan amount paid at closing (Most Deals are 3 points(%))Minimum Loan Amount: $50,000 (For loans less than $200,000 we charge $2,500 minimum)Max Loan: 65% of After Repair Value(ARV) 100% Rehab Financing Available (Require 20% of purchase price down payment or cross-collateral)Closing Timeframe: 48 Hours - 3 Weeks (Most Deals are 10 business days)We have private lending partners throughout the entire United States that cover the following states: AL, AZ, AR, CA, CO, CT, DE, FL, GA, HI, IL, IN, IA, KS, KY, LA, ME, MD, MA, MI, MN, MS, MO, MT, NE, NV, NH, NJ, NM, NY, NC, OH, OK, OR, PA, RI, TN, TX, UT, VT, VA, WA, WV, WI, WY.

If the A-B contract that you had the current owner sign calls for EMD, you as the wholesaler would be expected to put the deposit down with the attorney and once you have your B-C contract signed with the end buyer and the settlement closes, you would get your emd back along with the release fee.

He cancels it because i hadnt pulled the mechanical permits.

The buyer covers all title fees for both parties.

Now, how much more in fees can you charge vs the cost of the sauna, increases insurance premium, utilities and maintenance?

I'm not sure if I should let my friend put all of cash in for deals, and then I would take a management fee (either yearly or monthly), or if it is better to take an upfront fee.Any advice would be greatly, greatly appreciated!!

The only variable that I can think of that would be different then just rehabbing as a standard 2 family is the associated attorney fees for creating the condo docs (master deed, etc).  

@Amit Shukla - Not necessary, but many do just to sound cool ;)Not that I recommend it, but I have old school investors who are in their 70s with over 20 properties and not one in an LLC... think of all the filing fees and time they have saved by not doing so.