It will cost them nothing so they can only gain from my inexperience.

Talk with your CPA about the tax implications of flipping and paying taxes on the gains.

If it's rented out and you sell a year later, it will be taxed as capital gains instead of active income.

My plan was to sell the property next year, but wanted to pull some cash out prior to selling to help minimize the capital gains tax.Is there a proper name for this type of loan product that I should be looking for?

other investment opportunities (other than a flat out loan at a favorable interest rate) seem pretty fraught with peril as you will need your sister's consent and participation to take any action that would allow you to realize any gain, including a refi or property sale.   

The lowest long term capital gain rate is 0% and 15% for moderate income earners.

What we ideally would like to do would be to make this property into our primary residence for a couple of years and then sell the property, of course to avoid the capital gains tax.  

Between a couple of large notes purchased at huge discounts, with one now performing and the other paid off for a 60% gain ( with a 4 month hold time) and another big gain on a foreclosed property, we had our best year since we began our current fund (2013).

It is a great way to gain more pro's for your inner circle. 

I know about short term capital gains taxes, but also know about the self employment tax.