Just a little confused on that portion.

I wouldn't think that there's tenants that wouldn't care given that they're getting their housing covered and they might lose that.Are their portion big?

Most Hard Money Lenders require a portion of the Work to be completed from the Scope Of Work provided, before sending out the FIrst Construction draw.

He was willing to lend a portion of the house to us (its value) on which we would pay interest until that loan was paid back to him, presumably after the cash out refinance. 

I understand wholesalers do alot of this but with my current schedule I don't have the time and resources to get into wholesale deals just yetI am curious if their any non-wholesalers out there with a similar knack for the "analysis" portion of things that have been able to make some small side money doing freelance type deal analysis for other investors?

Im an owner and management co and have 92%  pay rate and the 2 that can't pay are paying small portions when able. 400k could get you into about 1.2million of property but a safer play might be 250k on 800K and save the rest  for repairs and a next deal while you get ur feet wet.

If still open they can cover some portion of the rent.

Regarding the rent for the portion of the 1st month, I would offer to pro-rate it to half a month's rent. 

Will this give me an advantage in depreciating the full value of the house instead of the just the portion I use?

Regarding your statement that "you should not lay your hands on any of the money at all, so the QI would not be cutting you a check", let me ask you this:  what happens to the funds if you fail to id a property in 45 days or close within 180 days, or fail to use all the proceeds from the sale, but do use a portion of the proceeds from the sale on replacement property?