Assuming he carries another mortgage fails to pay, your chance of getting back your house as second  can  be low.

So, I was thinking of using a mortgage.

And you're too small for the commercial guys to waste their time.The flip side to doing one loan is that if you want to sell one or more of the properties before the mortgage is paid off, that's going to be more difficult. 

So lets go with the idea the owner is carrying the mortgage and will pay it without effecting the deal. 

Here’s the secret: Create an LLC and have the LLC lend you a mortgage on the property you are receiving.The reason why this works is because instead of you needing cash or receiving a cash out loan, we are now refinancing a loan – your loan.

There is a mortgage on house.

2nd piece is the house hack...We think best course of action would be to have an investor friend we know buy the house in cash, once we are done with renovations, we then take out a full mortgage on the house to cover whatever he paid for it and then pay him back with some interest.

Hello and my question is,If my income was low , but I had access to funding.would I be able to put money in to a business I start up for my rental properties and claim it as business income or means of paying the mortgage in order to get approved  for a loan or to refinance a property if i take the hard money lenders way of getting a house? 

Try a google search for something like "biggerpockets leverage vs cash" or "biggerpockets pay off mortgage vs leverage" etc and you'll be busy for hours.

I have one friend I could approach about either partnering with me or making a hard money loan who might be able to make up the difference until I can mortgage it, but I also don't want to waste his time either and as I mentioned, I have low confidence in myself for this type of deal.