From what I know it's a pretty standard requirement.

I have a similar situation but I know the person and my question is what is the best solution to having the contract drawn up by a lawyer or should it be a standard contract with the right to assign it clause?

I like to classify complexity of rehabs into 3 categories: cosmetic, standard, and complex. 

Each investment is different so there is no standard.

What you need if you are going to be scaling up a flipping business is a standards list.

The last couple years I did not take all the deductions I was entitled to because I wanted schedule E to show a profit and not a loss, thus making my future borrowing a bit easier.

Ehhhh probably not so much.And then there's of course the standard biggerpockets.com advice to always be mortgaged to the hilt and ever more in debt, which would mean a cash out refinance to pull ~$200k out and buying something else.

All looks fairly standard above, but it really comes down to what you negotiate.

I have a great relationship with them (done exterior painting and small things for rent deductions) and I believe they would give me a good price.

If they don’t, then you’re rewarded for your risk in carrying that paper; you’re now getting 12% for holding that paper, and there is no balloon.ABILITY TO REPAYThe second category requires you to determine the buyer’s ability to repay, but the rules and the regs don't specify any standards for doing it (such as the qualified mortgage standard, a 43% debt to income ratio, etc.).