If you do not already own your primary residence, then it will be easier for you to get a loan with low to no money down with a better rate for that then it would be for another property.

Also what else can you do with that money that will add value. 

We do feel like we are throwing money away helping her with rent when we could be putting it towards an investment property instead, but there is always the fear of pulling the trigger on the first home that isn't your primary. 

Problem is, you lost money. 

We're not a sponsor or capital raiser, we don't get a cut of any of the money invested. 

Using Hard Money 10% down 100% rehab loan to finance the deal.

I consulted a lawyer and a few other investors to see if there was anything else to try to do, but they all told me the only way I was likely to see my money was if they went to try to buy a house one day they would need to pay off my "Lien" before proceeding. 

some ideas:- yes you could put more money down upfront, even though it's not ideal.- Look for off-market deals that are much cheaper,  using hard money and then refinancing with a rental loan.- Find properties where the owner will finance most of it, so you only need a smaller loan with the higher interest for the down payment.- Take over a property where you can continue the seller’s lower interest payments.- Another thought to give why would you want to do a rental at all, I mean those terms are horrible. why not buy something else with a better return on invest?

We have also decided that family always comes first, money is just money and if something happens to our partnership or management style we will sell the building.

It depends on the hard money lender.