What would be a contingency to get out of the deal if the rent rolls/ operating statement or lease info is not-verifiable or turns our to be false ?

The DSCR is calculated by taking the NOI (Net Operating Income) and dividing by the annual debt service (which is the total of monthly loan payments, including principal and interest for the year).  

If they are investing with you, you could form a partnership for each deal, where you serve as general partner and control day-to-day operations while your limited partners (investors) provide the capital. 

I know the form hasn't been released yet, but I wrote it into the operating agreement for my LLC and plan to use the form once it comes out.

I am familiar with his work, families know each other the whole nine.I financed it with hard money, front loaded the construction contract (So we could get ahead concerning draws) and spotted contractor 15k out of pocket to get through soft cost and get the project rolling.

I think including a preferred return into the operating agreement so as to cash out my colleague first if/when the property eventually sells seems good.

I have a really good attorney who I use in PDX that wont charge you an arm and a legg and scare you into all sorts of unnecessary and complicated asset protection schemes.. basically you can vest in LLC  have an operating agreement ( that's your JV agreement) and a clear cut buy sell agreement .. pretty simple and standard stuff.. feel free to ping me off line..

I exchange/collateralize my income property at current market value for cash to another company called ABCTerms..ABC owns title of the property.Under the operating agreement of ABC I will be asset manager owning 50% cash flow and tiered getting less cash flow year after year.

But if you are hiring a lot of small time operators, they probably don't have a policy.Regarding your flip, you want to double check with your current policy. 

You may even be able to get in touch with a larger lender that operates in your state.