High cost which equals Higher perceived risk(especially for the wife).

You might also consider utilizing percentages and have values based upon the rent, such as the security deposit being equal to the first months rent, this way it can vary from property to property but won't be construed has being different for an arbitrary reason.Disclaimer: The information in this post does not constitute legal advice and does not establish an attorney-client relationship.

For example, net cashflow of $500 per month and $500 equity increase from mortgage payments, which equals $12k per year.

Drive by the higher end sold houses exterior renovation usually equals what the interior renovation looks like, check the MLS or even zillow sometimes will have what the condition looks like.

Any ideas for helping the 3rd partner get to equal ownership? 

Look for deals where your equity is on equal ground to the LP.

Equally, if you decide you don’t like the property/neighborhood after all, that your commute is too long, or that you want to get your kids into a better school district, you have the flexibility to do that.

Terms are a very critical and crucial part of any real estate deal!

I treat them with respect as if we are equals  and I always fix their rentals up as needed .

If they are VERY professional, they will have their processes in writing as verification that it is enforced equally and fairly by their entire staff.6.