Basically he has an automated system that does all the legwork and you get paid a fee for being the middleman between a note holder and note buyer.

Hi gys -This time I went for loan - I was told the Debt to Income ration has to be under 49%.

Can I rationalize this deal some way, so I can fake myself into thinking a bad deal is a good one.  

This is for the average investor as well, if you can show you don't need a loan, you can probably get 75%, but your debt coverage ration will be going up, so, how rich are you?    

Sure, @Aldrin Contreras , it is ok to wholesale without a real estate/broker license... in fact, you don't need a realtor to wholesale a property if you find a owner who will sale you his/her property without a middleman....It is when you are looking to wholesale REOs is when you have to "DEAL" with a realtor...Good luck...

Your yield should reflect that liquidity assuming market participants are rational.

I have just done my first reno where I had a middleman help manage the project since it was my first flip, a complete renovation (really too big for my first project).

My question is this, does it matter ROI-wise whether we do 50/50, 20/80, or 80/20, assuming no matter what, our debt to net ration is still 50/50?  

Whatever helps you rationalize leaving that cost in there.As far as #1 - you're going to be looking for a while.  

By all means go ahead and evict them on your terms using your rationality.