You will need a manager (you will have to find and hire them) that you can totally trust - you won't be there to check in, so they have to be honest, or you'll risk it all. 

Any suggestions referrals welcomed for property management, small banks and other lenders (in the area), trust worthy contractors, and local CPAs & RE Lawyers.

We share a lot of trust and I'm confident we will be good partners but we should also be practical and consider what would happen if one of us needed to cash out, if one of us got divorced, etc.More experienced investors - do you always handle this through an LLC?

This seems very incorrect to me as the property would be a capital asset with depreciation deductions taken over years, yet the agent insists that he is correct and that this is a common practice for RE pros.I trust the agent but just think he is ill-informed and/or missing further details regarding his proposal, though I am open to the possibility that I may be missing something as well.Can anyone shed any light to help bridge the gap here  ? 

unfortunately with my current tax bracket, it's my understanding that i will be looking at about 30% (correct me if i'm wrong) in capital gains taxes and depreciation recaptureb) deferred sales trust, i like the idea of being able to invest in other investment vehicles but i'm not a very trusting person.

Check us out: Builders Trust Capital.

There is nothing different about a contract with seller financing other than the section regarding purchase price and financing.Here's a basic provision:Seller agrees to hold a purchase money deed of trust and note secured by the property in the amount of $x at a fixed annual interest rate of y% payable in equal monthly installments of $z... with the full unpaid balance due, if not sooner paid, on [date of balloon payment, if applicable]

You should target ~30% - 30% expense ratio (expenses/revenue).Also, the pro forma rents they have are most likely higher than what is in place because it's a value add deal and the goal is to Reno and then push rents.I've never used the valuation calculators before, but I would trust my own math in excel more than that.

Based on your post I'm going to suggest looking into some REIT (Real Estate Investment Trust) funds.

This is not without issues (the biggest of which is getting more funds into the IRA/LLC after future contributions), but it is worth exploring if it might be a good fit for you.On the other hand, if you are not looking for as much control, I have a great deal of respect for Quest Trust Company and it's owner Quincy Long.