Plug your numbers into this pro forma, see what your estimated profit will be, then use the local cap rate to determine how much you should offer for the property.

That leaves about a $45,000 profit before closing costs.

We just don't know how to structure initial cash down vs. profit sharing. 

My only fear is if the area can support an exit strategy if managing this property becomes too difficult or not profitable and I want to sell.  

get rid of your biggest debt 1st then make profits you know?

I used 20% vacancy, just to be sure not to over estimate my profits being generated and also a fair to low daily rate, which will only fluctuate up in better then poor market conditions. 

I owned that house for until 2005 selling it at a huge profit just before the bubble burst.Have you checked into refinancing at a lower rate or being relieved of paying PMI?

A lender that has experience working down many paths to close the deals and get to the profitability your are looking for?

Within 8 months the flip was bought, rehabbed and resold for a profit (taxes yet to be determined).

This decreases your profit.