If you want to run a charity for your relative, then you could just help them with the mortgage, or buy the house from them for a great rate and let them live there cheaply.

You are trying to say you will use the " investors" to fund community programs, that sounds like a charity because there is no earning on the investment.  

Following advice, I put $130K into a charity fund to start a 501(c)(3) non-profit.

If you’re itemizing your deductions, another great strategy is making a strategic donation to a charity or organization you believe in, like your favorite nonprofit or your church.

Have you checked to see if Bob is licensed to be representing buyers in your market I doubt he is doing this as a charity..

We are not white knights we are in business to make money on RE  not a charity or social workers.. so we do want to keep this in perspective you did what you needed to do so you could make a profit bottom line.

He refused to take responsibility, threatened you with attorneys, but then you settled for $5,000 to a charity?

Sometimes business moves sort of suck for the tenant - but at the end of the day they have to be done because you are running a business, and not a charity. 

So I stepped in we formed a JV and I bought them all so that he/we could resell.. cost him some money as of course I am not running a charity.. but it kept him in business once he got on the DRE radar. :) I suspect in SC my type of services will now become common place.

Of course yes I agree this is a business for goodness sake not a charity debt seeking organization in the first place.