Investing with foreknowledge that property values are falling seems like a timing problem or at least a situation where my offer would be reduced to reflect this coming change.As to how much to put in as a down payment that depends more on your numbers, your risk tolerance, ability to get financing, cost of financing, etc. 

We have struggled for years deciding whether to sell or hold because the tax implication to sell is very costly.

This is tough.Depends on how fuzzy you want the business/family line to be.The only thing I'd be absolutely sure of is that your money has more tangible security than being a "personal loan" EVEN IF you cut him a break on cost. 

Also, for anyone based in Philly, I've heard from one contractor that quotes of 20-30k were common a few years ago, but due to recent rule changes, contractors need to maintain excavation licenses/ insurances to do any dig out work and that cost is getting passed to customers.

Given the current market conditions my credit situation,and a title cloud that shouldn't be there, I'm exploring various financing strategies to manage this debt effectively.

That generally means going where housing is still relatively cheap, holding costs such as taxes and insurance are relatively cheap, and there is a lot of upward pressure on the housing market. 

DSCR is a better option on rates and cost compared to Fannie and Freddie loans.  

After analyzing the deal further, estimating holding costs, realtor fees, monthly costs on hard money, estimating the worst case scenario of it taking three months to sell (average time here is 43 days), rehab costs, insurance, etc., I am pretty sure we need to pull out. 

Can try to reposition to Class B, but neighborhood may impede these efforts.Vacancy Est: Historically 10%, but 15-20% should be used to also cover tenant nonpayment, eviction costs & damages.Tenant Pool: majority will have FICO scores of 560-620, many blemishes, but should have no evictions in last 2 years.

Account Closed Especially since you've done a deal already - I find it effective to have a credibility kit of some sort.